Stock Exchange is only a market for the sale and purchase of securities such as stocks and bonds. And like any commercial market There are many factors that may affect the exchange mechanisms. And if the stock market divided into three parts, and is the buyer and the seller and the market itself is able to easily identify the factors affecting each of these parts. But in this article would be a focus on the factors influencing the market itself. From this we can say that the following factors are most influential
- Supply and demand
- Transparency
- Rumors
- Economic situation
- Political climate
Let's look at all of these factors alone: -
Supply and demand
Is the theory of supply and demand of the oldest economic theories and the most important factors affecting the movement of stock market and determine stock prices and the traded securities. The show is the term used to refer to the possibility of providing goods in the market to your customers who want and can acquire them. And the providers of this product is the manufacturer and in this case is the stock market. And if moved to the definition of the term demand, you will find that the application refers to the desire and ability to purchase goods. And the relationship between supply and demand is the relationship of direct proportion, meaning that any increase in demand leads directly to an increase in display size. But if you can not the provider of a commodity to bridge this increase in demand result is the increase in prices.
Transparency
Transparency in the race Exchange refers to the speed and efficiency of the transfer of information to all investors at the same time within the stock market. And the transparency factor reflects the integrity of the proceedings on the Stock Exchange and is the group responsible for establishing the rules of justice and equality. So relay information quickly and efficiently believes that there is no advantage to any investor, so that they can be exploited to gain personal and not others, and for this reason law prohibits, for example to any minister of economy or financial trading in the stock market due to give his position many advantages with regard to economic information and financial State.
Rumors
Rumors are a player hidden in Exchange. Theoretically, there could not be considered a factor in the rumors exchange mechanisms of the difficulty of measuring their impact direct or indirect. But regardless of this fact the former, there is no investor in a stock exchange in the world did not give importance to the rumors. Vahaiat serves as an informal news agency to provide the information investors may find the source of threat or an opportunity for quick profit.
Economic situation
The relationship between the economic situation and level of performance in the stock market is a direct relationship of proportionality, as is the case with supply and demand. So we find it natural to flourish Stock Exchange in the case of the stability and prosperity of the economy of the State. And the main reason for this relationship is that the economy stable and prosperous provides a safety factor for investors within the country and reduces the risk of investment. This leads to an increase in the volume of investment and trade in the stock market. But in the case of a weak economy, the opposite is true as in the Egyptian stock exchange during the second half of 2000 as a result of acute shortage of liquidity and credit crisis Congress.
Political climate
The relationship between the political climate and the performance of the stock exchange relationship is not clear or fixed or proportional, like its predecessors. Political stability is not always an indication or reason for the boom in the stock market, and instability is not necessarily a cause of collapse.
The reason behind this relationship is non-obvious, that the political events affecting usually have two destinations, meaning that might adversely affect the party may be a benefit to another party. Adkha example for this is the period after the 1973 war when the Arabs have taken a hostile position toward Egypt, but in contrast to Egypt met with support and auxiliary of the United States to take the path of peace with Israel. So while the political situation of Egyptian and Arabic were troubled, the Egyptian greater benefit as a result of good relations with the United States. But regardless of these anomalies, we find that the turmoil of the political climate as a result of war, for example, always lead to the collapse of the economy and therefore in the performance of the bourse, as is the case in the Palestinian stock market, for example.
Friday, June 25, 2010
- How did the first stock exchange
The origin of the word Exchange to the family name, Van der Van der Bürsen Borsn Belgian who was working in the field of banking, which was her hotel, Bruges Bruges meeting place for local merchants in the fifteenth century, where he became a symbol of the capital market and commodities exchange. The publication of what looks like a price list of the Stock Exchange throughout the trading period for the first time in 1592 the city Anffers Anvers. In France, have stabilized the exchange in Paris at the Palais des Bronyar Brongniart proportion to the engineer who drew the charts in 1808. In the United States began Exchange Street Wall Street Wall Street City New York, the mid-fourteenth century.
What is the stock market?
The stock market is the undisputed place of exchange, which can be shared everything. When is the sale and purchase of food (such as coffee, rice, corn ...), and raw materials (such as petroleum, cotton, copper, ...), and securities (such as bonds, equities and obligations ...), and currencies (such as the dollar and the yen and the euro ...) , and even interest rates. everything is for exchange and trading.
What is the stock market?
The stock market is the undisputed place of exchange, which can be shared everything. When is the sale and purchase of food (such as coffee, rice, corn ...), and raw materials (such as petroleum, cotton, copper, ...), and securities (such as bonds, equities and obligations ...), and currencies (such as the dollar and the yen and the euro ...) , and even interest rates. everything is for exchange and trading.
- the forex for us
Had to that is that one of us that trade has been affected after testing Alliorowalzhb stock prices and oil also was inevitable that there will be a small part of the forum to follow up on these goods and see how the link between them and the Invision Power Board
It also tells us in mastering the technical analysis as the round could be achieved only on what is happening in the currency of the shares within a year all the principles and models of technical analysis
Finally, call me after this, then the brothers Distinguished Based on the forum to all who wish to participate or ribs, which will begin this section as a whole, Shi small and would become a great God and to you and I hope that does not keep your contributions to aging and young forever
Trading in currencies is always the exchange, any purchase and sale of other currency, for example, you buy the euro in U.S. dollars, pound sterling or yen and so on.
There are eight currencies are traded mainly in the Forex currency is divided into major and minor currencies as follows:
● major currencies (Major Currencies):
U.S. dollar is symbolized by the USD
Symbolized by the euro EUR
British pound GBP coded
Japanese Yen JPY coded
Swiss franc CHF coded
● currency secondary (Minor Currencies):
The Canadian dollar is symbolized by the CAD
Australian Dollar AUD coded
Aluzlandi symbolized by the dollar NZD
Because trading in the currency market always include a purchase and sale of other currency, is up to what is known as trading system Couples (Pairs), as the following examples:
EUR / USD - GBP / USD - EUR / CHF - AUD / JPY
It is divided into two pair:
The first currency: the currency is called the basis.
Second currency: called the counter currency.
And each pair exchange rate reflects what is paid from the second currency (the counter currency) to buy one unit of one currency (the currency basis).
Example:
Note: to buy 1 euro, you should pay the 1.3900 handle in dollars
Divided into pairs to:
● key pairs (Majors):
It consists of pairs of the U.S. dollar with other currencies of major currencies, and these couples are:
EUR / USD - GBP / USD - USD / JPY - USD / CHF
● pairs minor (Minors):
It consists of pairs of the U.S. dollar with another currency-exchange high school for example:
USD / CAD - AUD / USD - NZD / USD
● Hyper-pairs (Crosses):
It pairs is not a party to the U.S. dollar and its exchange rate is a rate multiplied by a couple of majors or secondary Examples include:
EUR / JPY - GBP / CHF - AUD / CAD
Example:
Exchange rate pair (EUR / JPY), is a multiplication of the exchange rate pair (EUR / USD) and a pair (USD / JPY).
-------------------------------------------------- ------------------------------
Lesson Summary:
Trading in currency system be any couples buying of one currency and selling of another at the same time.
Major currencies is (USD, EUR, JPY, GBP, CHF)
Currencies, most notably the secondary (AUD, CAD, NZD)
Currency pair is divided into two parts based on the currency and the currency exchange rate and the corresponding pair is what must be paid from the counter to get a unit of base currency.
-------------------------------------------------- ------------------------------
News analysis Fundamental Analysis
The definition of news analysis
Is the analysis looks at the market through news on the economic, political and social, that affect the supply and demand. In other words, we compare the country's economy that works well and the country's weak economy.
The idea behind this type of analysis is to be the country's economy - which you want to buy their work - that works well.
To say that the currency of this country must be strong economy of this country is strong.
Later in the next lessons you will learn what is the most important events and news that drive the currency exchange rate ...
Now all you need to know is that fundamental analysis in Forex is to determine the most powerful economy of the country's currency ..
Now the question ... How to be the country's economy strong!
* Any country has its own set of economic factors that affect the economy and thus can take advantage of the forex trader to buy the currency of this country with the strongest economy.
In order to be a successful trader in the Forex should know the following ...
Dates * economic data news .. The so-called economic indicators.
Are the most determines the strength or weakness of the country's currency in the timing of a specific time frame, whether short-or medium-or long-term.
Economic data which represent the economic situation make the results as a percentage or numbers or reports are grouped into statistical tables called "calendar" economic Examples of such data the gross national product and balance of current accounts ... Etc
* You must know the result of an index stock Stock indexes of the stock market ..
Ie they must know the outcome of the average stock market index of the country Her currency you want to trade in its currency ..
For example, an increase of the Dow Jones index in the United States for 0.3% per day, which means that 30 shares of the leading companies in the United States, which represents the record for the Dow Jones, prices have increased 0.3% in for the day, or earnings growth U.S. stock market.
* You must know the level of interest rates Level of interest rate
All investors are interested to buy currencies with interest rates most.
The Declaration of interest rates is linked to the Central Bank of the country Her currency.
It is very important indicator that reflects the look of other economic indicators, and the amount of controlling inflation and money supply policy or financial support.
* You must know all the information about the rate of inflation Inflation rate
And inflation: the higher the general level of prices, are measured by the overall level of prices at an average price of goods and services of the country and is not necessarily a rise in all prices for that, even in times of inflation, strong some prices may be relatively constant or some other prices may be reduced.
The relationship between inflation and interest rates ... Is one of the main factors that determine the level of interest rates, high inflation increases the cost of interest rates over the long term the more inflation was higher whenever headed the Central Bank of the country of her currency to raise interest rates, because of this we find that the index index of the cost the consumer of the most important economic indicators
* You must know the size of the growth of the stock of money in the Internal Market Growth of money stock at the internal market, one of the causes of inflation that have a role in the stock of money.
* Like to know the size of gold and currency reserves of the country.
Reserves of gold and currency reserves stored in the central bank and financial institutions as well as of gold and currency assets with international creditors, especially if you intend to trade in the currency pair in one of the terminal was "Australian dollar"
* You must know the price of oil per barrel ..
Especially if you intend to trade in the currency pair in one of the terminal was "the U.S. dollar or Canadian dollar," ..
* You must compare the basic driving forces of the country's economy each other ..
Like the trade balance trade balance
Balance of the government and government balance
And gross domestic product GDP .. Etc
* You must know the dynamics of production and trade of the country that you intend to trade in currency .. Like
The index of industrial production index of industrial production
And size of orders communications volume of commercial orders
Index of capacity utilization index of utilization of production capacity
Index of retail sales index of retail sales .. Etc
* Statistics construction sector in the State, including ...
Construction costs and the number of houses under construction and the issuance of a number of building permits, sales of new homes, etc.
* The statistics for the labor market (the level of unemployment, and a number of new active sites, etc.).
* Psychology research Sociologic researches .. Including,
Business Optimism Index of the population index of business optimism of population
And an index of business optimism for purchasing managers and directors of companies providing the service.
The index of consumer confidence index consumers ... Etc
* In addition to the extent of political stability and peace in the country, natural disasters and other investors will make it more secure or fear of investment in the currency of the country ..
What we can deduce from this!!
1 - Once the economic development and growth of the exchange rate for the currency of the country will grow as well.
2 - Once you have made the country's economic numbers are negative or start down the price of the national currency also be affected.
Come take the example ..
If the industries and firms and financial statements for the sectors in the country is moving towards progress and displays the results of a positive constant, it is expected that the movement of the currency of this country for the better.
For example, the U.S. dollar gains strength because the U.S. economy is growing strongly and win!!
When continued to rise in U.S. interest rates, the value of the dollar continues to rise against other currencies ...
Here our analysis of the basic currency of the U.S. dollar on the reports of U.S. interest rates, which encouraged the purchase of the dollar against other foreign currencies.
Fundamental analysis is also known as "news analysis"!
Because it includes the study of economic and political factors that may affect the currency market, which is issued in the form of news reports
These reports are grouped in the "Economic Calendar".
Just remember ...
1 - The price is a balance between "supply and demand"
2 - swing the balance between the sides .. When issuing news and if the expectations do not match with the official data published
This makes the prices tend to rise, "buy" or "landing" sale "according to news release to search for the exchange rate to achieve a new balance between supply and demand again.
If the application is less than the offer, it leads to lower prices and if the request is a stronger offer, leading to higher prices
That is to say that fundamental analysis is the study of any information or data is expected to affect the market price
Now, we abbreviate the above for you in the ideas of a quick on the factors effecting the economy of the country and then the change in the exchange rate:
1 - The issuance of economic news or news of what is known as economic indicators.
2 - changes that occur in the global capital markets and equity markets, gold, silver and oil prices, etc. ..
3 - Decisions of the central banks around the exchange ..
4 - Changes in interest rates on currencies.
5 - cases of inflation and the strength or weakness of her country's economy currency.
6 - government policy and political news and the pronouncements of the important
7 - levels of supply and demand.
8 - in addition to seasonal cycles and weather.
Learn in a news analysis ..
Snarafk What is the U.S. Federal Reserve Federal Reserve System!!
What is the role played by the U.S. Federal Reserve System in the development of a policy of reducing inflation!!
Interest rates and the economy
Political News and its impact on the market ..
We'll show you the relationship between the FX and money markets and the economy, "U.S. stocks and oil and gold"
We will discuss what is an easy way of economic indicators Economic Indicators!!
And we'll tell you how to read Economic Calendar Economic Calendar!!
And you will learn types of economic indicators in terms of impact on the market and index all of a country's currency ..
As well as you will learn what is the most important economic indicators, which should focus on!!
And you will learn how to read the news .. And how easily understand the report.
You will learn how to tie between the indicators and each other.
And how to make a profit to benefit from them!!
And also how to handle and study of economic data.
And you will know why we trade using the news!!
Uma is my husbands where we trade with the news ..
What are the dates of news reports
Basics in the country's economy
The relationship between inflation and interest rates and the role of the Central Bank
Remember ... These terms are in each economy of any country in the world ...
What is inflation Inflation
Sngi you a quick story ...
"Continued Mr." German "dream which will be retired after two months and began to paint dreams I thought of buying a house equipped with a small garden .. but suddenly announced that her Government news about inflation in prices
Dreams turned towards the purchase of a small apartment, then turned the dream of an apartment to a room, and after over two months of the issuance of the news received her pension, thank God, enough to buy a retirement dinner for one night.
What happened to the German woman had suffered by the German government after World War I, when prices began to rise in a rocket which led to the deterioration of the German economy strongly.
This story shows us simply fast definition of inflation.
Inflation: is the high general level of prices, the overall level is measured at an average price of goods and services to the country.
It is not necessarily a rise in all prices for that, even in times of high inflation, some prices may be relatively constant or some other prices may be reduced.
This is not what he meant business news anchor when he presents his monthly report on inflation; it only shows the (percentage) that the level of inflation as a change from last month
For example, when you hear that the report of the inflation rate this month came at 1%, this means only that the price level increased by 1% this month, may be changed an emergency; If inflation remains high for a long time (more than 1% per month for several years ) here is the economists that inflation is high.
That is the price of all goods and services rise by one at the same time, there were problems ...
But if that is happening is a cost for a range of goods and services whose prices rise very quickly, unlike the other sect may change slowly, and there is a third group remain static with no change, and there is therefore of benefit and there is harmed by this persistent inflation and hence the currency depreciates.
The effects of inflation
1 - with the increase in inflation show the intensity of the wave of price rises with the devaluation of the currency.
2 - disorder in transactions between the seller and the buyer, and between producer and consumer, and between the creditor and the debtor.
3 - The spread of chaos in the local economy to the State of the currency with inflation and therefore people give up their currency of their country and take refuge in the possession of the currency of another country with a better economy.
4 - damage to staff in public and private sector because they typically have incomes constant compared to a wave of price rises, while the income variable, such as: merchants and businessmen, Vdjulhm usually increases with the wave of inflation, but in many cases rise by more than the highest increase in the general price level They thus benefit from this inflation.
5 - savers of financial assets Ahmad and long-term bank; often exposed to large losses as the real value of their savings lose money year after year with high prices, you can either reflect the savings in the forms of in-kind such as land, precious metals, it is benefiting from higher prices this way.
6 - With the continuing rise of prices people are aware that the purchase today at the price levels prevailing is better than buying in the morning, because prices will rise more and more; hastily "compactness" of any procurement of goods and antiques, precious metals, the use of foreign currency is more stable in value, which is reflected in the deterioration of the exchange rate of the local currency, if there is inflation.
7 - The greatest damage affects the balance of payments of the State, is:
** Exposed local industries to fierce competition due to the high price of domestic products against the imported product, thus reducing demand on the domestic product, and thus lead to unemployment and the low level of domestic income.
** Due to the increased demand for imported goods and reduced demand for domestic goods is increasing deficit in the balance of payments, which require face either depletion of the country's gold and foreign currency, or resort to external borrowing, or liquidation of the state-owned assets abroad.
Example of this is what happened to the United States of America; Rising Fast in productivity in Japan and the European Common Market countries, high prices in the United States of America at a rate faster than the rise in other countries; led to reduce the surplus in the balance of U.S. trade, and eventually led to a deficit in balance of business processes.
** With the increase in the deficit in the general budget of the State of the State to use local currency to increase pumping Vtaatzaid amount of money without a corresponding increase, a corresponding increase in the volume of output, pushing prices to rise further and state intervention in a vicious circle
The relationship between interest rates and inflation
Inflation is one of the main factors that decide the level of interest rates. For this reason, any economic data or financial information seems to affect the interest rates or inflation will be of great importance to traders because it will provide new opportunities for trading when the market re-evaluate itself.
Higher inflation increases the cost for the interest rates on long-term and therefore affects the interest rates, which reduces brought from going to borrow. Therefore, people stop buying (ie, lack of demand) increases the products offered and therefore less production and this leads to increased unemployment. Or the so-called recession
Example: If inflation rose, the cost of goods and services more than making the purchase cost much more and that will affect people's savings and low investment return for increased spending or building houses, which may adversely affect the business society.
U.S. Federal Reserve System!!
Any country in the world with what is known as the Central Bank of the financial, the main goal is to form a monetary policy of the country as well as financial supervision and management of payment systems for the currency of the country, with the further right to intervene to influence the exchange rate of currency of the country to keep them from any dangers such as fighting inflation and to combat an increase prices to stabilize the financial system in the country ..
U.S. Federal Reserve System!!
Is the central bank's financial U.S. government, known as the Federal Reserve Bank.
The role of the U.S. Federal Reserve and its interventions in the exchange:
1 - Maintaining the stability of the U.S. financial system.
2 - Provide funds to help banks in the payment requests of depositors.
3 - the fight against inflation and to combat the rapid rise in prices for the dollar.
4 - increase or decrease the financial offer of cash in the United States to control inflation, because inflation slows down economic growth
For more information about the Federal Reserve Bank in New York and then visit their website newyorkfed.org to find many of the detailed information relating to trade in currencies, especially
The role of the Federal Reserve to counter inflation
When a recession is the Federal Reserve cut interest rates encourage people to go to the loans and make purchases for the reactivation of the economy. This solution is very effective in the short term, but the bank should take into account the long-term inflation and the balance between short-term objectives of increasing production and employment and the long-term objectives of reducing inflation rates.
Another concept, that makes the feds are important ..
Its ability to lower and raise interest rates in the short term, which indirectly affects the inflation ...
And therefore the direction of the economy in general.
Declaration of interest rates and the role of the Federal Reserve
One of the most important events that are related to the Fed and interest to foreign exchange dealer is a declaration of interest rates Interest rates
It is very important indicator that reflects the look for other economic indicators and the amount of control inflation and money supply policy or financial.
Recognize the possible benefit of currency positions of central banks ..
European Central Bank www.ecb.int
Japan's central bank www.boj.or.jp / en / index.htm
The U.S. central bank www.federalreserve.gov
Central Bank of England www.bankofengland.co.uk
Swiss central bank www.snb.ch / index.htm
Australia's central bank www.rba.gov.au
Canadian Central Bank www.bankofcanada.ca / en
Roller Ofer .. And Islamic law ..
There is no usury in the accounts of the Islamic ..
This part of the explanation only and not to take advantage of difference in interest rates on exchange rates.
Roller Ofer means that the trader when entering buy or sell a currency based on the margin the currency pair that he bought or sold has been retained with the deal for a new day, here in the next day, the interest rate on financing will be added to the balance of the merchant or deducted from the score due to changes in interest rate for the currency According to the type of transaction, whether buying or selling .
It also tells us in mastering the technical analysis as the round could be achieved only on what is happening in the currency of the shares within a year all the principles and models of technical analysis
Finally, call me after this, then the brothers Distinguished Based on the forum to all who wish to participate or ribs, which will begin this section as a whole, Shi small and would become a great God and to you and I hope that does not keep your contributions to aging and young forever
Trading in currencies is always the exchange, any purchase and sale of other currency, for example, you buy the euro in U.S. dollars, pound sterling or yen and so on.
There are eight currencies are traded mainly in the Forex currency is divided into major and minor currencies as follows:
● major currencies (Major Currencies):
U.S. dollar is symbolized by the USD
Symbolized by the euro EUR
British pound GBP coded
Japanese Yen JPY coded
Swiss franc CHF coded
● currency secondary (Minor Currencies):
The Canadian dollar is symbolized by the CAD
Australian Dollar AUD coded
Aluzlandi symbolized by the dollar NZD
Because trading in the currency market always include a purchase and sale of other currency, is up to what is known as trading system Couples (Pairs), as the following examples:
EUR / USD - GBP / USD - EUR / CHF - AUD / JPY
It is divided into two pair:
The first currency: the currency is called the basis.
Second currency: called the counter currency.
And each pair exchange rate reflects what is paid from the second currency (the counter currency) to buy one unit of one currency (the currency basis).
Example:
Note: to buy 1 euro, you should pay the 1.3900 handle in dollars
Divided into pairs to:
● key pairs (Majors):
It consists of pairs of the U.S. dollar with other currencies of major currencies, and these couples are:
EUR / USD - GBP / USD - USD / JPY - USD / CHF
● pairs minor (Minors):
It consists of pairs of the U.S. dollar with another currency-exchange high school for example:
USD / CAD - AUD / USD - NZD / USD
● Hyper-pairs (Crosses):
It pairs is not a party to the U.S. dollar and its exchange rate is a rate multiplied by a couple of majors or secondary Examples include:
EUR / JPY - GBP / CHF - AUD / CAD
Example:
Exchange rate pair (EUR / JPY), is a multiplication of the exchange rate pair (EUR / USD) and a pair (USD / JPY).
-------------------------------------------------- ------------------------------
Lesson Summary:
Trading in currency system be any couples buying of one currency and selling of another at the same time.
Major currencies is (USD, EUR, JPY, GBP, CHF)
Currencies, most notably the secondary (AUD, CAD, NZD)
Currency pair is divided into two parts based on the currency and the currency exchange rate and the corresponding pair is what must be paid from the counter to get a unit of base currency.
-------------------------------------------------- ------------------------------
News analysis Fundamental Analysis
The definition of news analysis
Is the analysis looks at the market through news on the economic, political and social, that affect the supply and demand. In other words, we compare the country's economy that works well and the country's weak economy.
The idea behind this type of analysis is to be the country's economy - which you want to buy their work - that works well.
To say that the currency of this country must be strong economy of this country is strong.
Later in the next lessons you will learn what is the most important events and news that drive the currency exchange rate ...
Now all you need to know is that fundamental analysis in Forex is to determine the most powerful economy of the country's currency ..
Now the question ... How to be the country's economy strong!
* Any country has its own set of economic factors that affect the economy and thus can take advantage of the forex trader to buy the currency of this country with the strongest economy.
In order to be a successful trader in the Forex should know the following ...
Dates * economic data news .. The so-called economic indicators.
Are the most determines the strength or weakness of the country's currency in the timing of a specific time frame, whether short-or medium-or long-term.
Economic data which represent the economic situation make the results as a percentage or numbers or reports are grouped into statistical tables called "calendar" economic Examples of such data the gross national product and balance of current accounts ... Etc
* You must know the result of an index stock Stock indexes of the stock market ..
Ie they must know the outcome of the average stock market index of the country Her currency you want to trade in its currency ..
For example, an increase of the Dow Jones index in the United States for 0.3% per day, which means that 30 shares of the leading companies in the United States, which represents the record for the Dow Jones, prices have increased 0.3% in for the day, or earnings growth U.S. stock market.
* You must know the level of interest rates Level of interest rate
All investors are interested to buy currencies with interest rates most.
The Declaration of interest rates is linked to the Central Bank of the country Her currency.
It is very important indicator that reflects the look of other economic indicators, and the amount of controlling inflation and money supply policy or financial support.
* You must know all the information about the rate of inflation Inflation rate
And inflation: the higher the general level of prices, are measured by the overall level of prices at an average price of goods and services of the country and is not necessarily a rise in all prices for that, even in times of inflation, strong some prices may be relatively constant or some other prices may be reduced.
The relationship between inflation and interest rates ... Is one of the main factors that determine the level of interest rates, high inflation increases the cost of interest rates over the long term the more inflation was higher whenever headed the Central Bank of the country of her currency to raise interest rates, because of this we find that the index index of the cost the consumer of the most important economic indicators
* You must know the size of the growth of the stock of money in the Internal Market Growth of money stock at the internal market, one of the causes of inflation that have a role in the stock of money.
* Like to know the size of gold and currency reserves of the country.
Reserves of gold and currency reserves stored in the central bank and financial institutions as well as of gold and currency assets with international creditors, especially if you intend to trade in the currency pair in one of the terminal was "Australian dollar"
* You must know the price of oil per barrel ..
Especially if you intend to trade in the currency pair in one of the terminal was "the U.S. dollar or Canadian dollar," ..
* You must compare the basic driving forces of the country's economy each other ..
Like the trade balance trade balance
Balance of the government and government balance
And gross domestic product GDP .. Etc
* You must know the dynamics of production and trade of the country that you intend to trade in currency .. Like
The index of industrial production index of industrial production
And size of orders communications volume of commercial orders
Index of capacity utilization index of utilization of production capacity
Index of retail sales index of retail sales .. Etc
* Statistics construction sector in the State, including ...
Construction costs and the number of houses under construction and the issuance of a number of building permits, sales of new homes, etc.
* The statistics for the labor market (the level of unemployment, and a number of new active sites, etc.).
* Psychology research Sociologic researches .. Including,
Business Optimism Index of the population index of business optimism of population
And an index of business optimism for purchasing managers and directors of companies providing the service.
The index of consumer confidence index consumers ... Etc
* In addition to the extent of political stability and peace in the country, natural disasters and other investors will make it more secure or fear of investment in the currency of the country ..
What we can deduce from this!!
1 - Once the economic development and growth of the exchange rate for the currency of the country will grow as well.
2 - Once you have made the country's economic numbers are negative or start down the price of the national currency also be affected.
Come take the example ..
If the industries and firms and financial statements for the sectors in the country is moving towards progress and displays the results of a positive constant, it is expected that the movement of the currency of this country for the better.
For example, the U.S. dollar gains strength because the U.S. economy is growing strongly and win!!
When continued to rise in U.S. interest rates, the value of the dollar continues to rise against other currencies ...
Here our analysis of the basic currency of the U.S. dollar on the reports of U.S. interest rates, which encouraged the purchase of the dollar against other foreign currencies.
Fundamental analysis is also known as "news analysis"!
Because it includes the study of economic and political factors that may affect the currency market, which is issued in the form of news reports
These reports are grouped in the "Economic Calendar".
Just remember ...
1 - The price is a balance between "supply and demand"
2 - swing the balance between the sides .. When issuing news and if the expectations do not match with the official data published
This makes the prices tend to rise, "buy" or "landing" sale "according to news release to search for the exchange rate to achieve a new balance between supply and demand again.
If the application is less than the offer, it leads to lower prices and if the request is a stronger offer, leading to higher prices
That is to say that fundamental analysis is the study of any information or data is expected to affect the market price
Now, we abbreviate the above for you in the ideas of a quick on the factors effecting the economy of the country and then the change in the exchange rate:
1 - The issuance of economic news or news of what is known as economic indicators.
2 - changes that occur in the global capital markets and equity markets, gold, silver and oil prices, etc. ..
3 - Decisions of the central banks around the exchange ..
4 - Changes in interest rates on currencies.
5 - cases of inflation and the strength or weakness of her country's economy currency.
6 - government policy and political news and the pronouncements of the important
7 - levels of supply and demand.
8 - in addition to seasonal cycles and weather.
Learn in a news analysis ..
Snarafk What is the U.S. Federal Reserve Federal Reserve System!!
What is the role played by the U.S. Federal Reserve System in the development of a policy of reducing inflation!!
Interest rates and the economy
Political News and its impact on the market ..
We'll show you the relationship between the FX and money markets and the economy, "U.S. stocks and oil and gold"
We will discuss what is an easy way of economic indicators Economic Indicators!!
And we'll tell you how to read Economic Calendar Economic Calendar!!
And you will learn types of economic indicators in terms of impact on the market and index all of a country's currency ..
As well as you will learn what is the most important economic indicators, which should focus on!!
And you will learn how to read the news .. And how easily understand the report.
You will learn how to tie between the indicators and each other.
And how to make a profit to benefit from them!!
And also how to handle and study of economic data.
And you will know why we trade using the news!!
Uma is my husbands where we trade with the news ..
What are the dates of news reports
Basics in the country's economy
The relationship between inflation and interest rates and the role of the Central Bank
Remember ... These terms are in each economy of any country in the world ...
What is inflation Inflation
Sngi you a quick story ...
"Continued Mr." German "dream which will be retired after two months and began to paint dreams I thought of buying a house equipped with a small garden .. but suddenly announced that her Government news about inflation in prices
Dreams turned towards the purchase of a small apartment, then turned the dream of an apartment to a room, and after over two months of the issuance of the news received her pension, thank God, enough to buy a retirement dinner for one night.
What happened to the German woman had suffered by the German government after World War I, when prices began to rise in a rocket which led to the deterioration of the German economy strongly.
This story shows us simply fast definition of inflation.
Inflation: is the high general level of prices, the overall level is measured at an average price of goods and services to the country.
It is not necessarily a rise in all prices for that, even in times of high inflation, some prices may be relatively constant or some other prices may be reduced.
This is not what he meant business news anchor when he presents his monthly report on inflation; it only shows the (percentage) that the level of inflation as a change from last month
For example, when you hear that the report of the inflation rate this month came at 1%, this means only that the price level increased by 1% this month, may be changed an emergency; If inflation remains high for a long time (more than 1% per month for several years ) here is the economists that inflation is high.
That is the price of all goods and services rise by one at the same time, there were problems ...
But if that is happening is a cost for a range of goods and services whose prices rise very quickly, unlike the other sect may change slowly, and there is a third group remain static with no change, and there is therefore of benefit and there is harmed by this persistent inflation and hence the currency depreciates.
The effects of inflation
1 - with the increase in inflation show the intensity of the wave of price rises with the devaluation of the currency.
2 - disorder in transactions between the seller and the buyer, and between producer and consumer, and between the creditor and the debtor.
3 - The spread of chaos in the local economy to the State of the currency with inflation and therefore people give up their currency of their country and take refuge in the possession of the currency of another country with a better economy.
4 - damage to staff in public and private sector because they typically have incomes constant compared to a wave of price rises, while the income variable, such as: merchants and businessmen, Vdjulhm usually increases with the wave of inflation, but in many cases rise by more than the highest increase in the general price level They thus benefit from this inflation.
5 - savers of financial assets Ahmad and long-term bank; often exposed to large losses as the real value of their savings lose money year after year with high prices, you can either reflect the savings in the forms of in-kind such as land, precious metals, it is benefiting from higher prices this way.
6 - With the continuing rise of prices people are aware that the purchase today at the price levels prevailing is better than buying in the morning, because prices will rise more and more; hastily "compactness" of any procurement of goods and antiques, precious metals, the use of foreign currency is more stable in value, which is reflected in the deterioration of the exchange rate of the local currency, if there is inflation.
7 - The greatest damage affects the balance of payments of the State, is:
** Exposed local industries to fierce competition due to the high price of domestic products against the imported product, thus reducing demand on the domestic product, and thus lead to unemployment and the low level of domestic income.
** Due to the increased demand for imported goods and reduced demand for domestic goods is increasing deficit in the balance of payments, which require face either depletion of the country's gold and foreign currency, or resort to external borrowing, or liquidation of the state-owned assets abroad.
Example of this is what happened to the United States of America; Rising Fast in productivity in Japan and the European Common Market countries, high prices in the United States of America at a rate faster than the rise in other countries; led to reduce the surplus in the balance of U.S. trade, and eventually led to a deficit in balance of business processes.
** With the increase in the deficit in the general budget of the State of the State to use local currency to increase pumping Vtaatzaid amount of money without a corresponding increase, a corresponding increase in the volume of output, pushing prices to rise further and state intervention in a vicious circle
The relationship between interest rates and inflation
Inflation is one of the main factors that decide the level of interest rates. For this reason, any economic data or financial information seems to affect the interest rates or inflation will be of great importance to traders because it will provide new opportunities for trading when the market re-evaluate itself.
Higher inflation increases the cost for the interest rates on long-term and therefore affects the interest rates, which reduces brought from going to borrow. Therefore, people stop buying (ie, lack of demand) increases the products offered and therefore less production and this leads to increased unemployment. Or the so-called recession
Example: If inflation rose, the cost of goods and services more than making the purchase cost much more and that will affect people's savings and low investment return for increased spending or building houses, which may adversely affect the business society.
U.S. Federal Reserve System!!
Any country in the world with what is known as the Central Bank of the financial, the main goal is to form a monetary policy of the country as well as financial supervision and management of payment systems for the currency of the country, with the further right to intervene to influence the exchange rate of currency of the country to keep them from any dangers such as fighting inflation and to combat an increase prices to stabilize the financial system in the country ..
U.S. Federal Reserve System!!
Is the central bank's financial U.S. government, known as the Federal Reserve Bank.
The role of the U.S. Federal Reserve and its interventions in the exchange:
1 - Maintaining the stability of the U.S. financial system.
2 - Provide funds to help banks in the payment requests of depositors.
3 - the fight against inflation and to combat the rapid rise in prices for the dollar.
4 - increase or decrease the financial offer of cash in the United States to control inflation, because inflation slows down economic growth
For more information about the Federal Reserve Bank in New York and then visit their website newyorkfed.org to find many of the detailed information relating to trade in currencies, especially
The role of the Federal Reserve to counter inflation
When a recession is the Federal Reserve cut interest rates encourage people to go to the loans and make purchases for the reactivation of the economy. This solution is very effective in the short term, but the bank should take into account the long-term inflation and the balance between short-term objectives of increasing production and employment and the long-term objectives of reducing inflation rates.
Another concept, that makes the feds are important ..
Its ability to lower and raise interest rates in the short term, which indirectly affects the inflation ...
And therefore the direction of the economy in general.
Declaration of interest rates and the role of the Federal Reserve
One of the most important events that are related to the Fed and interest to foreign exchange dealer is a declaration of interest rates Interest rates
It is very important indicator that reflects the look for other economic indicators and the amount of control inflation and money supply policy or financial.
Recognize the possible benefit of currency positions of central banks ..
European Central Bank www.ecb.int
Japan's central bank www.boj.or.jp / en / index.htm
The U.S. central bank www.federalreserve.gov
Central Bank of England www.bankofengland.co.uk
Swiss central bank www.snb.ch / index.htm
Australia's central bank www.rba.gov.au
Canadian Central Bank www.bankofcanada.ca / en
Roller Ofer .. And Islamic law ..
There is no usury in the accounts of the Islamic ..
This part of the explanation only and not to take advantage of difference in interest rates on exchange rates.
Roller Ofer means that the trader when entering buy or sell a currency based on the margin the currency pair that he bought or sold has been retained with the deal for a new day, here in the next day, the interest rate on financing will be added to the balance of the merchant or deducted from the score due to changes in interest rate for the currency According to the type of transaction, whether buying or selling .
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