In theory, the smaller Forex retail traders should have a slight advantage when it comes to capitalizing on how the news affects the markets. With immediate Internet access and a never ending stream of brokers willing to execute trades at any hour of the day, small investors should be able to buy or sell a position quicker than some large conglomerate, mutual fund, or hedge fund. The market can literally adjust in minutes to relevant news releases so investors who move quickest will be able to capitalize-in theory.

Of course, it does boil down to knowing what news is relevant and then to determine how that will affect the currency exchange rates. Even news from countries other than those in your currency pair can play a significant role in short term price corrections. For those wishing to trade in the Forex based upon news releases, there are 8 major currencies currently playing significant roles in the market, including:

1. U.S. Dollar(USD)2. Euro(EUR)3. British Pound(GBP)4. Japanese Yen(JPY)5. Canadian Dollar (CAN)6. Australian Dollar(AUD)7. Swiss Franc(CHF)8. New Zealand Dollar(NZD)

Because the USD is a backer in nearly 90% of all transactions on the Forex, the release of key economic indicators from the U.S. are always important to the currency exchange rates. These data are released at regular intervals which supposedly levels the playing field between the large and small investors. In theory, they should be able to capitalize upon short term price fluctuations caused by the release of these key indicators:

1. Interest Rate Decisions by Central Banks/Financial Policy Makers2. GDP rates3. Balance of trade4. Unemployment data5. Inflation 6. Retail sales/manufacturing output7. Business Confidence as determined by Outlook Surveys8. Consumer Confidence Surveys9. Manufacturing Confidence as determined by Outlook surveys

Trading on the Forex based upon news releases means capitalizing upon short term fluctuations in the market as it corrects itself. Because these corrections can happen in a matter of minutes, it is vital for this type of investor to capitalize quickly or risk jumping after the market has already adjusted for the new information. While this is theoretically possible, it is very possible that the big investors had access to the information prior to its release. If these investors have already shifted their investments accordingly, then the market will have already corrected for the news before it was released-at least partially. If that is the case, then the small investor will jump in too late and likely face a loss.

Indeed, trading upon news releases is very dangerous because it also encourages over trading-a factor known to lead to losses-especially on the Forex. This is why most Forex investors rely upon technical analysis and their trusty charts when making decisions about entry and exit points on the market!

Before I share my analysis with you I decided that I would let you know that both brokers use the Metatrader 4 platform and have fairly tights prices, however IC Markets is a true ECN forex provider and Vantage FX is a market maker broker. Being a market maker forex broker is not a problem as long as the broker doesn’t play games with the spreads when you begin earning money, however unfortunately this is a huge problem with the majority of market maker forex brokers.

After trading utilising the Vantage Fx live platform for 2 months I found that their spreads were fair and remained relatively tight over news announcements. One thing that did upset me was that when I tried to trade any amount greater than 2 standard lots their execution speed would fall significantly, it was as if my order was being sent to a dealing desk to be manually executed. When trading sizes of lower than one standard lot I did not have any issues whatsoever although I’m positive that if I started to make money my execution speeds would have been slowed down no matter what. The Vantage fx platform is Metatrader 4 so this is a actually a big plus for the company as I can make use of my expert advisers without any issues. Their server appears to be quite reliable and didn’t disconnect me all the time which was on the list of huge problems that I have had with a number of the other Metatrader 4 fx brokers in Australia in the past.

I discovered the service at Vantage fx to be very average, they were able to help me with a good number of things, however they do rely on their clientele being familiar with Metatrader 4 and do not help a lot with the initial platform setup, this could be a problem for new forex traders who’re not familiar with the Metatrader 4 trading platform. I attempted to phone them after-hours on several occasions and seemed to get through to the same tired and cranky man every time, he wasn’t really helpful at all. After hours support is certainly not this fx brokers expertise.

IC Markets also use the Metatrader 4 trading platform which is obviously an enormous plus for them also, one of the interesting aspects of this forex broker is that they’re a true ECN forex broker which is unlike nearly all other Australian fx brokers. After two months trialling this broker, every time I traded I continued to be surprised at the spreads that they were showing me. I had always heard that ECN brokers were able to show superior spreads than their market marker colleagues, however I did not realize that the spread differences could possibly be that significant, I was often able to deal on Zero spreads on IC Markets Metatrader.

I had read a few forum posts stating that the execution speeds of some ECN fx brokers may be slower because orders must be confirmed in the ECN market place before they’re filled. During my 2 months of trading with IC Markets I did not detect any speed problems at all, my trade execution speed was actually quicker with IC Markets than with Vantage FX.

Among the list of key advantages of ECN forex brokers is that large orders can be placed without any delays or rejections. I confirmed that this was possible with IC Markets. I experimented with trades up to 7 standards lots in size without latency or slippage problems, I would have tried putting on bigger trades but I was restricted by my account balance.

I contacted IC Markets a couple of times just to see how good their support was and I discovered that they were really helpful, they guided me through the Metatrader trading platform and were able to assist with a few forex trading queries that I had, this was a real shock to me. I tried contacting them after hours expecting their support to deteriorate however this wasn’t the case the person I spoke to understood the Metatrader trading platform well.

If I was to recommend one of these broker platforms to members of my forex trading group there is no doubt that it would be IC Markets, Vantage FX however remains a really good forex provider, however they wouldn’t be good for active fx traders or those using expert advisers. IC Markets is a good all round broker their spreads are super tight which is good for scalpers, there are no trade size limitations, they offer the Metatrader platform and their service is absolutely outstanding and definitely the best that I’ve experienced out of all of the Metatrader 4 brokers in Australia. I personally now deal with IC Markets myself.

Of course you need to know why currency prices undergo frequent changes. You should use fundamental analysis for this purpose. Thus you can explain any market movements. Certainly when conducting fundamental analysis you need to take into consideration some established correlations as well as casual relationships in the Forex market.

Let’s assume that the entire world imports gold from your country. As follows from this if gold suddenly rises in value then your country’s currency will go up too. I should say that many factors can influence the price of your country’s currency. Exactly fundamental analysis studies these essential nuances of the world economy.

You should clearly realize that fundamental analysis isn’t an easy subject to study. So if you’re a light-minded person then I really doubt that you can succeed in studying this extremely complicated subject. Fundamental analysis normally contains huge amounts of conflicting information that may cause a great confusion to you if you try to interpret the world economy’s daily facts. It’s highly recommended to look through financial news on a regular basis if you really want to understand how the world economy works.

As for technical analysis I can say that it’s utilized for the same purpose as fundamental analysis. But unlike fundamental analysis it has a visual approach to the foreign exchange market. In simple words technical analysis is based on the use of price charts. Using price charts Forex traders can spot trends. Technical analysis seems to be easier than fundamental analysis. But on the other hand it’s ideal. But anyway you have to use it.

Day trading means that all positions are closed by the end of the trading day. Potential profits and losses are thus tallied up by the day’s end, giving clarity to your financial position. As traders aim to exit the day on a profit, some positions may be closed before the day has ended. 
Potential profits and losses from day trading depend on the financial value of your market position. These positions may be leveraged, which will magnify the volatility of the financial market in question. Although the time period is relatively limited, market movements can be sudden and unexpected, and often occur over a very short time period.

You can use spread betting and CFD trading in order to quickly access the markets. Financial spread betting and CFD accounts are subject to status but they available from a range of providers such as FinancialSpreads.com and IG Index . A common feature of a trading account is a desktop trading platform, although the web based platform is more popular.

As mentioned above, day trading limits your trading executions to a single day. This does not mean, however, that it is easier or more likely to result in profits. Achieving profits and sustaining them over a series of trading sessions is far from easy.

You can test your speculative skills by opening a demo trading account that lets you trade without risking any of your capital. You can refine a strategy through practice and by learning from both your profitable and loss making trades.

Technical Analysis and Fundamental Analysis

Analysis of the underlying financial market can help you refine your trading strategy. Day trading strategies can be developed according to fundamental or technical analysis, the two key types of market analysis.

Fundamental analysis depends on the belief that external events and factors can determine a market’s movement. Political events, for example, may boost or depress a financial market as traders gain or lose confidence.

In terms of day trading, a fundamental analysis strategy can be aided by regular access to news sources, such as news wires, online newspapers and other news or financial media.

Technical analysis uses charts and is focussed upon the interpretation of historical price movements. Thus, if a financial instrument, such as a currency pair, has risen or fallen in the past, you may decide it will do so again in the future.

However this is also the key flaw in technical analysis, just because a market has moved in a certain direction in the past that does not mean it will continue to move in that direction.

Spread Betting and CFD trading are financially geared types of trading they carry high levels of risk to your capital and you can lose more than your initial stake. Always trade with capital that you can afford to lose. Before making any trades make sure that you fully recognise the risk when investing with these investment formats. It is important to note that Spread Betting and CFD trading may not be suitable for all investors. Where appropriate, seek independent advice.

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There are major forces wielded by news reports both global and local on the currency market.While finance related news without a doubt yields the greatest effect, other non-finance but major events have their own impact too.These could either be unanticipated or foreseen.

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Events like the ravages wrought by Hurricane Katrina or 9/11 are unexpected events which may impact the currency exchange market.Stop-losses are just about the only remedy in these cases.

A good example of anticipated events would be choosing the host country for the Miss Universe Pageant.The chosen countries economy would experience an increase in investor trust which can lead to an appreciation in its currency value.

In the same breath, the losing competitors could possibly suffer an inverse effect on their currency.Thus a currency trader must be well informed about such events as well as the nations involved.

Parallel events are the daily finance data updates in scores of countries.While not released as often, the details on the economy will be released from time to time and this contains data on the rates of inflation, interest rates, GNP, GDP and other key economic indicators.

Currency trading always involves two currencies, a fact that you must keep in mind.While checking reports in your home country is easy, it sometimes leads one to forget to verify events in other countries.

Americans in particular, are predisposed liable to this due to the domination by the US currency as far as foreign exchange intelligence is concerned.This is further amplified when a secondary currency is traded against the dollar.One must ensure that his data is unbiased .

New traders must also be very aware of these other parts of basic analysis in the foreign exchange scene.For such upstarts, anticipating key events and departing the market before they happen is the prudent thing to do.

A method based on fundamentals may take form as you become expert in the market.But more than anything else familiarity with the forex fundamentals is very important .

Note: FX trading is risky, may result in material losses, and is not appropriate for everybody.

The well known capabilities of the MetaTrader 4 mobile platform for iOS powered Devices will assist traders of all skill levels and experiences to trade Forex using an arsenal of technical analysis tools, technical indicators and through the ease of use in everyday activities. All these exciting features are available in the MetaTrader 4 iOS App.

“Online trading anytime and anywhere – a true mobility is now available with the MetaTrader 4 iOS Application,” Gaies Chreis, the company’s COO, says. “Our users have long waited for the mobile version of the program for iOS powered devices. We’ve done our best to provide a high-quality tool for mobile Forex trading, which will become an indispensable assistant.”

The MetaTrader 4 trading platform has been designed to work with PDAs and Mobile Smartphones. Both editions, developed for Microsoft Windows Pocket PC and Windows Mobile, have proved extremely popular. For this reason the company decided to extend the availability of such mobile applications as per current smartphone market trends, with the development of iOS mobile Applications and soon to follow MetaTrader 4 Android Application. MetaTrader 4 iOS Application is the first step in this direction.

About the company

MetaQuotes Software Corp. is a professional development company of software applications for financial markets. With more than a decade of experience, the company is currently a market leader providing one of the best trading software for Forex. The company’s MetaTrader 4 trading platform is the world’s most popular Forex trading platform.

Japanese yen is gaining as exports lead the recovery of the damage done to Japan’s economy following last year’s devastating earthquake and tsunami. Because of the importance of exports to prominent Japanese companies, leaders desire a weak yen.

With the yen gaining against the US dollar, Japanese leaders have once again put Forex traders on notice. Finance Minister Jun Azumi affirmed that Japan stands ready to intervene in the markets to keep the yen low if that is what it takes. Forex traders have no reason to doubt Japan’s resolve; the country has already intervened more than once in the past in an effort to keep the yen weak against the US dollar.

For now, risk appetite has other currencies gaining against the Japanese yen; only the US dollar is weakening against the currency. With excitement over better than expected data in the eurozone and Britain, it is little surprise that high beta currencies are in favor.

At 15:35 GMT USD/JPY is down to 76.1090 from the open at 76.2650. EUR/JPY is higher at 100.2700, up from the open at 99.7850. GBP/JPY is up to 120.6580 from the open at 120.1950.

If you have any questions, comments or opinions regarding the Japanese Yen, feel free to post them using the commentary form below.

The focus this week for European leaders will be to address the mounting criticism of their handling of the debt crisis by delivering new fiscal rules and work out a solution for Greece as the rescue plan for that nation flounders. The discussions surrounding Greece and the reduction of the debt burden re-main a strong focus and will be an important tests in the eyes of international investors. Pimco’s Bill Gross has already stated that a Greek default is very likely. There was speculation last night that the ECB acted to buy Italian and Spanish bonds. In other currencies, the GBP is trading at…while the Australian dollar continues to hold up well at 1.0300.

With the Martin Luther King holiday in the United States, investors were focussed largely on Europe and it was somewhat of a surprise to see a very muted reaction to the S&P downgrade of a number of eurozone nations including France. Although US markets were closed, S&P futures did record a modest rise as the market awaits results from Wells Fargo, Citigroup and Microsoft this week. In Europe, after initial weakness, the bourses there have closed higher with the DAX gaining 1.25% to 6,220 while the FTSE rose 0.37% to 5,657. Carnival, the world’s largest cruise ship operator, fell 14%, after one of its ships struck rocks and capsized off the coast of Italy.

Commodities futures were largely closed fro trade due to the US holiday. WTI crude rose 1% to above $99.60 as the war of words escalated over the Irani-an situation. Precious metals are higher with gold gaining 0.8% to $1,644 while silver is trading just below $30 up 1.43%. Soft commodities were largely closed for trade while copper gained 1.07%. Today, we have the release of the high impact Chinese GDP data amongst a series of other releases including retail sales and industrial production. Overnight, we have UK and European CPI, a speech by BOE Governor King and the Canadian Rate Statement. The Chinese data will have a strong impact on the markets this week if they show a marked slowdown in the world’s second biggest economy as we expect.

GOLD moved higher in offshore trade as sentiment picked up, especially in the Euro region with bond yields falling in France after a successful bond auction. The USD steadied which assisted a rise in precious metals prices but all in all it was a quiet night with the US off on holidays. Gold finished offshore trade stronger by 0.80% at $1,643. A very quiet night for precious metals last night as most of the big moves come out of the US and the liquidity just wasn’t their as we had a US holiday. Prices remained well bid throughout the session and are definitely looking prone to further gains. Support down at $1,625 was never in doubt and this level remains short-term support and below here key support is now located at $1,600/05. So depending on the timeframe depend son where stops should be placed. Longer-term holders should consider stops under $1,580 for now. A move looks set to test $1,662 and if we get through here then we should continue to grind back towards $1,700. China data key today so any weakness after this data should be an opportunity to get long.

AUD/USD was one of the best performing currencies during the last 24 hours as the better than expected Australian Home Loans data started the ball rolling and with a lack of liquidity around the markets due to the US long weekend the price managed to get back above 1.0300 and posting a 1.0335 top during the US afternoon.  This bounce hasn’t surprised us and yet again we are seeing it as another opportunity to re-enter a short term sell position. The price has already moved back to 1.0306 to close out the US session with the ratings agency S&P taking any positive spin out of the markets with a downgrade to the EFSF Bailout Fund from AAA to AA+.  There is a lack of Australian data, however, with the Chinese GDP release today expect some movement for the AUD. The AUD looks to be on the knifes edge of something and this could be the tipping point. An    improvement in Chineawill see the bulls take AUD above the pivot 1.0370 whilst a lower number will give the bears what they have been waiting for, more Doom and Gloom with parity around the corner.