Technical Analysis for Crosses

GBP/JPY

The Pound declined slightly against the yen yesterday yet the pair managed to close above the 38.2% correctional level at 205.68 and is trading around this level now, the pair must consolidate for a while before start rising noticeably, since the momentum indicators are showing the pair needs a slight correction on intraday basis in order to successfully breach the 206.15 resistance level which would lead the pair up to the 207.35 at least, while the point at 204.53 offers strong demand for the pair should the 205.68 be breached.

Support: 205.68, 205.18, 204.53, 203.99, 203.41
Resistance: 206.15, 206.57, 206.96, 205.57, 208.03

EUR/JPY

The Euro managed to incline against the Yen as the pair breached the 38.2% correctional level at 162.26 and is targeting the 163.75 level, supported by an inverted Head and Shoulders model over the four hours chart the pair was able to acquire some strength to indulge in a bullish wave, yet the momentum indicators are showing the pair is now trading within an overbought area and is in need of a correction, yet this correction shouldn't breach the 162.11 which is the main support for the medium term upside channel.

Support: 162.67, 162.24, 161.88, 161.55, 161.14
Resistance: 163.03, 163.32, 163.75, 164.08, 164.44

EUR/GBP

The Euro gained back against the Pound yesterday but the pair couldn't breach the resistance at 0.7918 so far though it's very likely that will happen today supported by upside momentum and upside signals from the direction indicators, the pair however must breach the 0.7931 to confirm further upside waves that might target the 0.8000s level, while if the pair fails to breach this level it could go all the way down to the support at 0.7875 which offers good demand for the pair.

Support: 0.7904, 0.7890, 0.7875, 0.7860, 0.7844
Resistance: 0.7918, 0.7931, 0.7944, 0.7958, 0.7973

Crown Forex

disclaimer:The above may contain information for investors/traders and is not a recommendation to buy or sell currencies, gold, silver & energies, nor an offer to buy or sell currencies, gold, silver & energies. The information provided is obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. I am not liable for any losses or damages, monetary or otherwise that result. I recommend that anyone trading currencies, gold, silver & energies should do so with caution and consult with a broker before doing so. Prior performance may not be indicative of future performance. Currencies, gold, silver &energies presented should be considered speculative with a high degree of volatility and risk.

FOREX : Foreign Exchange Market

FOREX is a word play on the term Foreign Exchange Market. It is a market for buying and selling of currencies from all over the world. Certainly, such transactions are bound to be voluminous. It is just an estimate that there are about transactions of $1.5 trillion USD on a daily basis in the FOREX. Now just compare this with the paltry $300 billion USD a day transactions for the US Treasury Bond and the $100 billion a day transactions for the US Stock Exchange.

The FOREX came into existence in 1971 when the fixed currency exchanges were abolished. Currencies no longer had fixed values after that; on the contrary, their rates (mostly taken in comparison with the USD) were fluctuating, and changed on a daily basis. Throughout the seventies and the eighties the FOREX grew steadily, showing more advancement in the later years. The market has stupendously grown from $70 billion USD a day to the staggering amount that it transacts today on a daily basis.

There are actually about five thousand trading institutions in the FOREX. These include international banks, central government banks such as the US Federal Reserve, and commercial companies and brokers for all types of foreign currency exchange. The best thing that shows the unbiased nature of the FOREX market is that it has no fixed headquarters anywhere – it operates primarily from all major cities like New York, Tokyo, London, Hong Kong, Singapore, Paris, Frankfurt, etc. One can even use the telephone or the internet to make the transactions. The major businesses at the FOREX are the buying and selling of products in other countries. Several transactions are also conducted from the currency brokers or traders who stand to make small profits with the daily fluctuations in the market.

Most of the FOREX business is centered on big banks and financial institutions, but it doesn’t mean that the FOREX is inaccessible to small investors. The recent changes in the financial regulations have effectuated this accessibility. Earlier, a minimum transaction size was required to conduct business with the FOREX. But the current rules have made it possible to break large inter-bank units into smaller bits. Each bit is worth as less as $100,000. This makes it possible to each individual investor through loans that are extended for trading, known as leverage. The ratio to control the lots is 100:1. This means, every $1000 USD will allow one to control $100,000 on the FOREX.

The benefits of trading with the FOREX are mentioned below:-

(1) Liquidity of Investments – As the FOREX is a huge market, the funds have a very high degree of liquidity. This is because of the presence of the international banks who provide their bids and carry out a large number of transactions on a daily basis. Therefore, there is always a buyer or seller for any type of currency.

(2) Highest Degree of Accessibility – The FOREX is open 24 hours a day for 5 days a week. Every Monday morning the exchange opens at Australian Standard Time and closes on Friday afternoon at New York time. Greater accessibility is provided because the transactions can be conducted from the person’s home or office.

(3) Open Market – At the FOREX, there are no secrets. All the fluctuations that occur in the market are made accessible to everyone at the same time. There is no insider trading in the FOREX.

(4) No Commission – There is no hassle of paying commission to the brokers in the FOREX. Here the brokers earn by setting up a difference between the buying price and the selling price of a currency, which is known as a spread.

It must be understood by now that for the FOREX to work effectively, the currencies must always be traded in pairs. For instance, the Japanese yen must be traded against the euro. When one kind of currency is sold, there should be another to be bought in its stead.

The profit happens because there is always mobility between the different currencies. Even if there is a miniscule change in the exchange rate, then it could mean substantial changes in the profits due to the large amount of money involved in the transactions. People are thronging to the FOREX and not any other institution due to the trust that they have in it. To add to the advantage, the market is absolutely well-advanced and uses sophisticated software for dealing out its transactions.

FOREX-DD : Forex Daily Analysis