FXstreet.com

FX Weekly Report

0

0

How Will the Bailout Effect USD And The Currency Markets?

Sat, Sep 27 2008, 20:03 GMT
by Pierre Charlebois

www.TradingPostFinancial.com


eurjpycadgbpuerusd

That’s the $700 billion questions isn’t it?

The truth is both exciting and also quite frightening. We are witnessing an historic time in the world financial markets, not just in the US. The fact remains that the US economy is something equivalent to 25% of the world economic output. You can’t have a situation like this happening in the US without severe affect on the rest of the world. The world has not witnessed anything like this since 1929. When your kids and grand-kids go to University they will be taught about this time in economics and politics as being one of the greatest events of the last 100 years. It will be interesting to look back on this 20 or 30 years from now to see how this event changed the world of finance and I’m sure, politics as well. With the most historic US election happening at the same time, Hollywood script writers couldn’t have imagined such a scenario!

As a result, all markets have been going sideways for days now waiting on a final outcome on the ‘Bailout’ plan. What happens this weekend will shape the future for many years to come. What is important to remember is that most world economies trail the US by about 6 to 12 months (in normal times). With this kind of event this will surely be accelerated and the spill over effect will ripple quickly throughout the rest of the world.

Because all markets are moving sideways awaiting more news, it is very difficult to read waves and patterns. So what happens immediately after a resolution on the plan is difficult to project. If you are planning to trade as the market opens and a final plan is approved, be prepared for the possibility of EXTREMELY volatile moves.

Please be cautious and trade with very good money management. Keeping risk below 2% of your account is strongly recommended.

As a result, this week I will simply be pointing out what I perceive to be the most important barriers. Breaks and turns will likely happen at the defined levels. The challenge will be in the volatility as this may cause false actions.

Cheers and good trading.


Archive

Trading Post Financial Services Inc.  | #310 - Dunsmuir Street. Vancouver, BC V6C 1N5
http://www.tradingpostfinancial.com | admin@tradingpostfinancial.com

Legal disclaimer and risk disclosure

High Risk Investment Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures, stocks or options on the same. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results. There is considerable exposure to risk in any off-exchange foreign exchange transaction, including, but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price. CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN. The content provided in this site is put forward in good faith and believed to be accurate, however there are no implicit guarantees of accuracy. The reader accepts that by using this information, he or she will not hold Trading Post Financial Services, Inc., ('Trading Post') responsible for decisions based on information from this site. This website may contain links to other websites. These links are provided as references to help you identify and locate other Internet resources that may be of interest. These other websites were independently developed by parties other than Trading Post Financial Services Inc. and Trading Post does not assume responsibility for the accuracy or appropriateness of the information contained at, or endorse the viewpoints expressed at, such websites. Currency trading is risky, it involves substantial risk of loss, it is not appropriate for everyone, and therefore only risk capital should be used for trading. Risk capital: money that a person can afford to lose. Past performance is no guarantee for future results. Actual trading results may vary.


Interested in forex trading? forex brokerage firms!


MF Global UK Limited
Contact the broker/FDM
Open a demo account
ACM Advanced Currency Markets SA
Contact the broker/FDM
Open a demo account
Alpari (UK) Limited
Contact the broker/FDM
Open a demo account
Forex Club Financial Company
Contact the broker/FDM
Open a demo account
GFS Forex & Futures
Contact the broker/FDM
Open a demo account

FXstreet.com will give you a 3 months membership as soon as minimum rebates have been generated (€150 for private trader/ €300 for corporate trader)

[Read Premium full description]

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer.

Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.

Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. FXstreet.com has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.

Any opinions, news, research, analyses, prices or other information contained on this website, by FXstreet.com, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXstreet.com will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

©2008 "FXstreet.com. The Forex Market" All Rights Reserved.