The Driver - Part 2

Hi-llo, fellas..

How's your weekend going? Good?

Remember, always spend your time with your loved one no matter how busy you are.


So, you guys know already who are the investors that drives the FOREX market?



Here a little did I know about them.

Last post I mentioned the term Currency , like US, they have dollar ; British, they have pound ; Japan have yen ; and so on.

The currency is a country's strength, 1 of the factor is the ECONOMY.

Basically, when a country's economy growth is good → currency is good, strong, strengthen. (last post i mentioned the correlation between country A and country B resulted in an exchange rate.)

Simply put, the country itself drives the currency market. Indirectly speaking, those who contribute to a country's economy are the actual driver.


Who are these contributor? YOU!

Yes, the human (of course, bruth~)

I give you an example,

When you travel to a foreign country, you will likely hood make an exchange rate right? Indirectly, you're helping your country invest. (well, in this case, we always loss when change back the rate right?)

So, when you travel to Japan, you change your dollar to yen, but you loss when you change back to dollar. → means you are helping Japanese yen to grow stronger.

Same thing goes to Japanese travel to our country, they are the one helping our country's currency grow stronger because they spent money in our country, they are our customers.


Well, that's not the only driver. There's
-FOREX trader just like me, FX trader are investor, they invest capital in the market.
-Bank, same as trader, investor.
-Tax.
-Inflation.
-Interest.
-Politics Affairs
-International Trades (Export & Import)
-etc.

Above mentioned are also the market driver.

Maybe you guys still haven't clear the mind yet. I will pick another driver to explain.
You noticed the term, tax and interest are actually bank's language right?

I will try my best to explain,

Situation A

When the tax and interest goes up on the milk, making the milk more expensive. Will you buy the milk more or less?


Situation B

When the tax and interest goes down on the milk, making it more cheaper. Will you buy the milk more or less?



You get what I mean?

The result will be, when you don't buy the milk, their economy goes down and loss in profit.
These situation leads to lessen tax paid to the government by the producer.
Leads to the government has less income, less income, less investment.

LESS INVESTMENT → COUNTRY ECONOMY GOING BAD → CURRENCY WEAKENED

So how are you guys doing?

Seat tight and relax.

Next post I will introduce the market layout.


May you guys be blessed.

The Driver - Part 1

Hi guys,

How you guys been holding up till now? Good? Not good? Not good but not not good?

I'm sure everything will be just fine for you guys. May you guys be blessed.

So today (i think i'm going to write this and save and continue write and save a several time),

We are going to discuss about who drives the market.

Buyers & Sellers.

Remember how I explain the market move from past to present, and those customers/suppliers how they could affects your economic growth?

We will try to dig in and investigate who are they in FOREX market.

When I described what FOREX mean, i meant by "Currency Exchange" . Foreign Currency Exchange to describe the whole thing. Thus, the term Currency.

So who drives the currency? Can a currency get strong/weak when someone buy/sell the money?

Lets take a very recent event as our example shall we?



US Presidential Election.

Euro pound vs US dollar

What did you all see?

(1)- You guys noticed the first zone where it spike up?
(2)- And suddenly spike down;
(3)- Gradually move downwards since then.

Here how i could explain (To my knowledge and readings)

Rumors said IF Mr Trump won the election, the US dollar will weaken; vice versa,

Mrs Clinton won, US dollar strengthen.

WHY?
-This was because all the time the US government was organized by democratic party.
-The investors were confident with the policies (which was established very long time already) created and maintained by the government.
-The investors never like changes, especially to the policies that they are holding on for such a long period of time.What if the terms changed? What if those terms were not in their favor?
-When an organization which established by the democratic, suddenly hand over to the republican party, it means everything's changing. - which leads to previous point.
-The investors will have second thought, doubt, anxious, towards their money which already in that particular country. What will they do after that?
-They will take back and called off the deal.
-When a country lost investors, they lost their customers! >>>  BAD PROFIT!!! US Dollar will DROP!!!

When Mr Trump had the lead in votes, those investors were having trouble, anxious, doubt towards the organization what will become, which leads to the zone (1) spike up.

Now why it's spiked up? Weren't it dropped? Spikes down?

This is because the chart is illustrates Euro pound vs US dollar, when US dollar weaken, the Euro gained advantages > strengthen their pounds > spike up!!

There are 4 scenarios can be interpret in the chart Euro pound versus US dollar.

Remember when we were in school learning mathematics?

Imagine...

The Price (C) can be manipulated through 4 conditions.

1-Price ↑ when Euro pound strong (↑).

2-Price ↑ when US dollar weak (↓).

3-Price ↓ when Euro pound weak (↓).

4-Price ↓ when US dollar strong (↑).

You guys cool?

Now it make sense huh why it spiked up.

But
why the dollar strengthen back at the end of the day? Weren't it supposed to weaken??? Because he won~

This is how Trump attracts all the investors.  The power of speech
His words, his confidence to make American great again, he succeeded in continue the deals with investors. More customers, more profit, more strong.

That's how the chart spiked down and continued its journey to south.


Investors = Customers = Buyers / Sellers

Now you all get it who's the driver of the market now?

OR

Who the hell are those investors?

Buyers & Sellers

Hi, guys..

So last post i wrote about what is "FOREX" . I hope you guys understand something from my previous post.

so Today i would like to write about ... ... ... ... ... ... ...

about what?

Maybe you guys wondering how can we know the market reach 1 point where we certainly it will bounce . What? bounce? what is that?

Let's look at the above figure, we look it from left side to right side alright?

The first zone i marked blue line at the bottom & red line at the top, with the A, B, C, D.

Remember that we need to look from left to right? This is because the price move from past (Left) to present (Right).

From point A  to point B to point C and to point D.

The bounce is refer to how A can reach C. Which is through B. Agree?
So the point B is the bounce point aka turning point.

you good fellas?


_________________________________________________________________________________


How Does The Market Move?
Good question.

1 Thing for sure, there are a lot of factors.

1 of them is what we called Buyers & Sellers.

okay, ask yourselves.

When you open a shop. How you define your business is doing good?

Yup, a lot of customers come and buy stuff from your shop right? So you will be making a lot of profit.

and when there's no body is coming, and yet the suppliers keep coming and force you to pay for the goods in advance, is this good? your profit will drop!!

When the rate of customer is higher than the rate of supplier coming, your net profit is growing UP.
When the rate of supplier is higher than your customer, well...enough say...your net profit is

DOWN!

It goes the same with the currency market. If the shop have customers and suppliers as buyers & sellers,

What drives FOREX market?







I will continue in the next post of who drives the FOREX market.



Thanks a lot guys!
Regards.

The New Challenge.

Hi guys, Naz here.

I decided to create a blog based on my technical analysis view on FOREX market. What is FOREX?

FOREX is a short term of FOReign EXchange.

Like how we went to money changer to convert our RM4.20 for 1 USD, thats forex.

Imagine when the rate is RM3.20 at that time. You convert 1000 USD with RM3200.

Now that the rate goes up to RM4.20, you decided to sell your 1000 USD.

So, you will get RM4200. hmmm..does that mean I gained RM1000!!!??? (RM4200 - RM3200)

Yes you are RIGHT!!!

wow~~~~ you just earned RM1000.

That's pretty much how FOREX works. the only thing that different is, you go to money changer and wait for like, 6 months to let the rate goes up ; i on the other hand, i can make it within 1 month time.
(Pro will be like within a day they can easily earned 4digits) ---> im no pro.

so, how can i earned that within a month time?

this is a chart of euro pound versus US dollar within a month.

if you noticed the chart in dotted line, initial and end price is also the same value. in blue circle below. connected with blue line.

so we can see at 1st August until 1st September, It has movement up and down before go back to its original price from 1st August.

from 1st August, price at 1.11744 , went down to 1.10453 within 1 week time. that mean,

at 1st August, 1 euro pound = 1.11744 usd. (Yup, every 0.001 cent was count in FOREX)

and later at 5th August, 1 euro pound dropped to 1.10453 usd.

in eye of usd, when i invest 1000 euro pound at the price of 1.11744, i invested 1117.44 usd;

somehow it dropped to 1.10453 which leads to 1104.53 usd,

i've lost my money on that investment!!! (lost 12.91usd actually)

BUT,

in eye of european,

they invest 1000 usd (894.90 euro pound) @ 1.11744 on 1st August,
on 5th August, the rate drop to 1.10453, which is 905.36 euro pound, later they sell back their 1000usd. which they had just earned 10.46 euro pound or equivalent to 11.55 usd.

overall, that's how the FOREX market work daily, weekly, monthly.

on the 2 weeks following, the euro strengthen from 1.10453 to 1.13674. total of 3.221 cent.

imagine you invest 1000 euro at that time, you have earned another 32.21 usd.

and the final week, you invest in 1000usd, you earned 27.06 usd.

brings you total of 70.82 usd at that month.

But wait,

how is that possible to earn 1000usd in a month like i said?

FYI, a forex market unit price is $10,000 - $100,000.

A unit price of $100,000 allows you to move 0.01 cent equivalent to $1. which means, when the market move total of 0.50 cent, your unit price earn/lost $50.

Well, we dont have that much of money, even $10,000 man.

That is where broker steps in (a broker is act like a bank which allows you to open forex account and invest in their platform). They offered you leverage to trade as full contract size ($100,000), with minimal capital.

let say just now we have 1,000 usd, and the broker gave you a leverage which equal to $100,000,
$1,000 is equal to 0.01 of $100,000. with the leverage of 1:100, you will be able to trade/invest as full contract size.

now lets re-do the situation of profit above. now that we have contract of 1 unit price, this means every 0.01 cent movement, we are going to +$1 / -$1.

lets recalculate,

1 : 1.11744 - 1.10453 = 0.01291 ~ 1.291 cent movement
2 : 1.10453 - 1.13674 = 0.03221 ~ 3.221 cent movement
3 : 1.13674 - 1.11241 = 0.02433 ~ 2.433 cent movement

Total cent movement = 6.945 cent movement

0.01 cent = $1
6.945 cent = how many $ ????

694.5 USD!!!

in 1 month time, you have earned almost 700USD!!! well, there's secret how you can move from 700usd to 1000usd.

within 1 month you can almost earn back what you've invest. imagine if you consistently earn 700usd a month for 6 month. how would it end up?

this is how FOREX work basically. you can earn both way as euro or usd.

HOWEVER!!!

This need knowledge to do so, FOREX is not a game, you need skills, knowledge, and technique to master it.

"Success is dependent on effort"

If you have what it takes to become a pro trader, that's the secret how you can manage from 700usd to 1000usd.

--------------------------------------------------------------------------------------------------------------------------

Thats all for now shall we.

Till next time,