Monday, December 30, 2013

6 Advantages Of Trading Forex

6 Advantages Of Trading Forex

Keywords: forex,forex software,forex trading software,forex tips,forex education,pips,forex trading systems,

Forex is the popular term for foreign exchange markets. The banks and brokerage firms are linked via electronic network to do business in the stock markets. The network allows them to convert currencies worldwide.

It became the chief and largest liquefied financial market around the globe. Take for instance, the volume of dollar currencies can rapidly increase in trillions of dollars within a day in currency markets. It even goes beyond the total volume of the total equities in the U.S. as well as future markets.

Forex trading is dominated often by commercial banks, investment banks, and government central banks. This is the main reason why many private investors are dealing on currency exchanges. They find it easier to access the market through technological innovations such as the internet.

It also provides the needed information in the stocks market regarding trading forex. The currencies which are widely traded include British Pound, US Dollar, Japanese Yen, Swiss Franc, Australian Dollar, and Canadian Dollar. Forex trading is done 5 days within a week and the traders can have constant access to various dealers all around the world. The trading does not mainly focus on any exchange or physical location and the transaction happens between two persons via electronic network or a phone line.

Forex trading has grown rapidly on the global market. The restrictions on the flow of capital have even been put off in various countries. This factor leads to market independence settling the forex rates on its perceived values. There are different reasons why forex trading is very popular. It include utmost liquidity, available leverage, lower trading costs.

There are different advantages of forex trading in the stock markets. Traders are making bigger sums of money by selling and buying foreign currencies. However, some people might ask of its advantages on the stock market.

1. Liquidity. Forex market can handle transactions even if it reaches 1.5 trillion dollars every day. Take note, this is a very large volume. It only denotes that sellers and buyers are always available regardless of the currency types. So, if the trader wanted to buy, there is always an available seller, and if the trader wanted to sell, there is always an available buyer.

2. There is no insider in the trading systems. Remember, constant value fluctuations of several currencies are caused by economic change. Some traders may obtain the information before others get it. So, they can sell or buy it within the stock markets. However, the nation’s economy is accessible to every trader so nobody can take an inside advantage to anyone.

3. It has accessibility. It is operational for five days within a week and accessible for twenty four hours. Trading can be made during this period.

4. It has more predictability. It always follow the market trends even the trends that are well established.

5. It can allow smaller investments. The potential traders can open mini accounts even for a few bucks of dollars. Forex trading has high leverage which is around 100:1. It only signifies that your assets can be controlled 100 times over your invested money.

6. It has no commissions. The forex trading brokers can earn money through setting their spreads where they weigh the process between selling and buying currencies.

Forex trading can be one of the best systems in day trading. Since it deals with currency trades, it can have the largest volumes of trading. Although it can be labeled as high risks trading systems, it can bring the traders higher returns within minutes.

However traders should be aware that forex trading needs a thorough research before starting it. Never confine yourself with only one source. Always make it a part of your plan to research first before engaging yourself in the real forex trading. It is not enough to know its advantages. As a trader, you need to clearly understand the systems involved in forex trading. It is helpful if you read the latest forums posted in the community boards.

It is also important to find the best forex trading systems. In this manner, you can incorporate a course, software, or method developed by forex trading experts. Take note, there are various system types that are available. It is important to find the right system that will fit in your goals in the industry of trading forex to achieve success.

Tips For A Good Forex Trading System

Keywords: forex,forex software,forex trading software,forex tips,forex education,pips,forex trading systems,

One rule of thumb that every aspiring entrepreneur should remember is that to make huge profits, you should know how to do it by yourself—and not rely on other’s efforts. Being independent from other people will help you determine what things are best for your business.

Such rule applies on all types of investments, including foreign currency trading, or mostly known as Forex trading. It cannot be denied that Forex is the largest existing market around the world, which is estimated to have an excess of 2 trillion U.S. dollars worth of foreign currencies are traded each day. It is larger than the magnitude of the New York Stock Exchange, which is approximately 50 billion U.S. dollars. Thus, Forex market exceeds all combined equity markets around the world.

With such huge wealth circulating around the Forex market, one of your financial goals is to grab a major slice of that $2 trillion average daily turnover in the market. How you will be able to get a substantial portion of that average turnover if you do not know how you will handle your Forex business? Although you cannot live in the market alone (you need business partners and/or financial advisers to help you along), only you can determine what the best Forex business there is for you.

To get huge profits out of your Forex trading career, you need to build your own profitable system—a trading system that will bring your not just hundreds but thousands of dollars worth of Forex revenues. Such trading system is available on the market, but as previously mentioned, you need to be independent—and you need to have your own Forex trading system that will help you achieve your financial goals.

For new traders, it is difficult for them to device their own trading system since they do not have too much knowledge about the Forex market. However, even a neophyte trader can device a trading system that will fit on his personal preference and needs—in just five easy steps!

Before we discuss the five easy steps towards a profitable Forex trading system, you need to learn first the three main characteristics of a successful Forex trading system. These are as follows:

1. A successful Forex trading system is simple. There is no need for a complicated trading system with too many rules. It is a proven truth that simple systems work better than complicated ones, and they have higher chances of success despite of the “brutal” characteristic of Forex trading.

2. A successful Forex trading system cuts losses and runs profits. Keep in mind that you need a trading system that gets the huge possible profits and eliminates losses quickly, if not instantly.

3. A successful Forex trading system follows long-term trends. You will never cover your losses if you are just generating small profits. Keep in mind that the Forex market is worth $2 trillion U.S. dollars, thus there is no point in trading in exchange for just small profits if you have the opportunity to make trades for larger revenues. Focus on long-term trends and you will be able to see better results.

Now, here are the five easy steps in building a profitable Forex trading system:

1. As previously mentioned, your trading system must be as simple as possible. Integrate few yet essential rules and an extensive investment management system.

2. Always look for long-term trends (preferably on a weekly basis), then shift to daily charts and to time entry. This will help you analyze market trends efficiently.

3. The ideal way of trading foreign currencies is through breakout method.

4. Always watch for any break that you will note on your chart, which is commonly confirmed by stochastic crossed with bearish divergence. This will be your great timing tool whether you will enter a certain deal or not.

5.You must integrate effective time management within your system. Time is gold and is one of your precious resources. Design a trading system that is time efficient—where you can maximize the potential of your time resources to generate huge profits.

Get away with complicated systems; it will just ruin your entire Forex trading career. Build a simpler one and see for yourself how profitable it is.

Saturday, December 28, 2013

Learn How You can Make Gains from Using the Forex trading Grid Technique

Learn How You can Make Gains from Using the Forex trading Grid Technique

Keywords: Forex Trading, Hedged Trading, Hedged Forex Trading, Hedged Grid Trading, Trading Strategies, Mathematical trading method

The most important part of how to make money using the no stop, hedged, Forex trading strategy will now be covered. In the preceding articles in this series we reviewed trading without stops, not being concerned about which way the price moves and places to cash in on profitable transactions. We are now going to show how you would make money buying and selling simultaneously using the grid strategy.

The no stop, hedged currency trading grid system uses the rule that one should be able to close a transaction at a gain no matter which way the market moves. The only way this is logically possible is that one would have a buy and a sell transaction active simultaneously. Most traders will say that doing this is not recommended but let’s look at this in more detail.

Assuming a grid with grid gaps of 100 pips. We are going to use the simplest formation to show the principles involved. This formation is the 100% retractment formation where the price goes up to a grid level and then returns back to the starting grid level. Regrettably things become quite mathematical from here. We are also ignoring broker spreads to keep things simple.

Let us say that a trader enters the market with a buy (buy 1) and sell (sell 1) deal active when a currency is at a level of say 1.0100. The price then goes to level 1.0200. The buy will then be positive by 100 pips. The sell will be negative by 100 pips. Now we would cash in our positive deal and bank our 100 pips. The sell is now however is carrying a loss of -100 pips. The grid system requires one to ensure that the trader can cash in on any movement in the Forex market. To do this one would again enter into a buy (buy 2) and a sell (sell 2) deal at this level (level 1.0200).

Now, for convenience let us say that the price moves back to level 1.0100 (the starting point).

The second sell (sell 2) has now gone positive by 100 pips and the second buy (buy 2) is making a loss of -100 pips. According to the grid trading rules you would cash the sell (sell 2) in and another 100 pips will be added to your account. That brings the grand total cashed in at this point to 200 pips (buy 1 and sell 2). At this stage the first sell that is active has moved from level 1.0200 where it was -100 to level 1.0100 where it is now breaking even.

The 4 transactions added together now incredibly show a gain:- 1st buy (buy 1) cashed in +100, 2nd sell (sell 2) cashed in +100, 1st sell (sell 1) now breaking even and the 2nd buy (buy 2) is -100. This gives an overall a gain of 100 pips in total. We can liquidate all the deals and have some champagne as we have made a profit of 100 pips.

Please make sure you understand the mathematics behind the activities discussed above. You may have to reread and draw the movements on a piece of paper to make sure you understand the concept.

This formation is the 100% retracement formation where the price goes up to a grid level and then returns back to the starting grid level and results in a nice profit for the forex trader. There are many other market movements that turn this strange Buy and Sell at the same time activity into profits. The next article will cover the 50% retractment formation which produces the same amount of profit.

There will be much more on the no stop, hedged grid trading system in future articles in this directory. Do not miss them, whatever you do.

10 Advantages Savings Plans Have That The Forex Does Not

10 Advantages Savings Plans Have That The Forex Does Not

1. Safety. In general an investment paying 12% interest is not as safe as one paying 6%, but it is doubtful if the 12% investment involves twice the risk.

If the income offsets the additional risk or provides a reserve against which to write off losses when they eventually come, then high yield investments justify themselves, and they do when they are chosen with intelligence, with information at hand on the investment and when they are administered carefully, as we will see.

Along with this general theory that there is a good deal of merit to investing in high yield opportunities, safety should be stressed. This leads us to the second characteristic of the investments we are going to examine.

2. Collateral or guarantees. A home owner may show you his bank account and also prove that he owns his home free and clear, so that you conclude that he is a good risk whose signature on a note is as good as gold but it is far wiser for you to take a mortgage on his home. Or if he has securities it is better to have him assign the securities to you than just to take his promise to pay.

If a dealer sells you a customer's conditional sales contract on an automobile he sold on which the customer is obligated to pay in time payments over a given number of months or years, it is well, if possible, to have the dealer guarantee the contract in case the customer defaults. Two people are obligated to pay, and certainly two are better than one.

3. Provision for easy repayment. If someone borrows $2000 from you at an attractive rate of interest and promises to repay it at the end of 12 months with 15% interest, the proposition on its face is a bad one. If he needs the $2000 now, what assurance is there that he will have it to repay at the end of 12 months? Such a sum is not small. Does he intend to borrow from Peter to pay Paul at the end of a year? In New York City a seemingly very substantial man did just this for years and got away with it until he died. That was over two years ago and the creditors are left holding the notes.

Periodic, small payments are a sensible requirement, and it must be demonstrated that the debtor can make these payments out of his income when all of his obligations are taken into consideration, and these obligations must be known.

4. Responsibility for payment. Some individual or individuals, or a corporation composed of very distinct individuals must be obligated to pay in the type investment we are talking about. Unimproved land on the edge of the city may be a fine investment. Some day it may double or even triple in value, but what we are trying to emphasize is the type of investment in which there is an obligation on the part of a person or persons to pay a given amount at a given time or in time payments, and you as the investor must look to this person or these persons to pay you on the due date.

5 .Liquidity. The longer a contract runs the less liquid it is and generally the less desirable. You cannot get your money out of it for a long time, and then the business or the business climate may change. The person who lent $10,000 in 1928 for five years in all probability had difficulty in collecting in 1933. A demand note is certainly preferable to a five year note. You may have need for the money sooner than you thought when you made the investment, and if you are tied up for five years you cannot get your funds back. Perhaps better opportunities will present themselves. Stay as liquid as possible.

6. Spreading of the risk. If you have $10,000 to invest it is best not to put it all in one place into a mortgage for instance. It is far better to put it into five mortgages of $2,000 each. The $10,000 mortgage could be defaulted, but there is not so great a probability that all five mortgages will be defaulted.

7. Part time administration. We are not writing for the purpose of getting a person to quit his job in order to devote all of his time to his investments. We are writing for the person who wants to invest in his spare time and look after his investments in his spare time. The investments described here may in some cases require more watching than others he has made, but by definition they must require a minimum of administration on the investor's part. Payments must be made regularly, and the skipped or late payment must be the exception.

8. Business functions performed by someone else. You as the investor should not undertake to perform any business function. The only function you should perform, once the investment is made, is to receive the payments, and in the event that payments are not made, you should be able to resort to a simple procedure at law to retrieve your money. If you invest in a filling station you should not have to hire a manager and then proceed to sell gas and oil yourself, under our definition of the type investment discussed here. The filling station should be leased to a major oil company for a fixed rental, and the oil company should perform all of the business functions.

9. Investment not subject to litigation. When a debtor can't or won't pay, the first thing he thinks of generally is some defense (and his imagination is unlimited on this point) against paying you: you had agreed to lend him more at the end of a year, and because you did not lend more his business failed. Or the rate of interest you charged was usurious and thus contrary to law; or you really owed him something before you ever lent him the money, and this should be an offset against what he owes you. These defenses are used almost every day.

If he signs a note, he should sign a waiver of judgment note (in states which recognize such notes) and such a note will be described later. Your investment should not be subject to litigation, and you must be sure of this fact before you make it.

10. Tax advantage. The Internal Revenue Code and Regulations state what the obligations of a tax payer are and what they are not. You are obligated to pay every cent you owe, and you are not obligated to pay what you do not owe.

Certain types of investment are more heavily taxed than others. There is nothing the matter with investing in state and municipal government bonds just because you do not pay any federal income tax on the interest. This is the law, and it works to the advantage of the investor in government bonds and incidentally makes it less difficult for the state and municipal governments to finance their operations. Investments with a tax benefit or tax shelter are more desirable in many cases for the investor than those without such a benefit or shelter.

However the Forex can make you rich within months instead of years.

Friday, December 27, 2013

“How To” Start Trading The Forex Market? (Part 8)

Keywords: forex trading, managed forex accounts,alternative investments,how to start trading forex,

HOW TO predict the Future ?

by studying the Past (Technical Analysis):

1) The best traders don't discount one or the other but understand that having an understanding how the fundamentals influence market sentiment gives him/her an edge over those traders who don't.

2) In my opinion, TECHNICAL analysis is the easiest and most accurate way of trading the FOREX market.

3) "The number's don't lie" - all available information and its impact on the market, are already reflected in a currency's price.

4) Prices move in trends - the foreign exchange market is mostly composed of trends and therefore a place where technical analysis can be very effective.

5) History repeats itself - over time, certain chart patterns become consistent, predictable and very reliable. The question is SEEING them.


The traders who don't believe this obviously have no need to implement a trading methodology on technical analysis. But, research has shown that those who trade "with the trend", greatly improve their changes of making a profitable trade.

Finding the prevailing trend will help you become aware of the overall market direction and offer you better visibility,especially when shorter-term movements tend to clutter the picture.

HOW does technical analysis help to determine what the trend is and HOW to trade with then trend versus against it?

Even though, you learn you how to use and read various technical indicators to identify a long- term trend, spot predictable chart patters and use certain rules to enter and exit a high-probability trade, and even though a ll this involves sound logic, parameters, methods, formulas, data, and research, these technical indicators, by themselves, are not the Holy Grail of FOREX trading.

It takes discipline and emotional control to stick with trading following through the inevitable market ups and downs. Keep in mind, good technical traders expect ups and downs.

Which technical indicators are the BEST?

NONE - technical indicators should simply be components of your overall customized, personalized trading system, and not a stand alone system. The objectives as a FOREX Technical Trader are:

1) To figure out the price action of the currency pair. Price is the main concern. If the EUR/USD is at 1.2224 and goes to 1.2020, 1.1980, 1.1940- the market is in a down trend.

Despite what every technical indicator might predict, if the trend is down, stay with the trend. Indicators showing where price will go next or what it should be doing are useless.

A trader should only be concerned with what the market is doing, not what the market might do. The price tells you what the market is doing.

2) Always remember that technical indicators are only giving you confirmations based on what the market is telling you. So listen to the market and let it tell you which method, strategy or techniques you should use.

Thursday, November 28, 2013

Examples of transactions in the forex

At this time we will learn how to trade or open position in the market on Metatrader charts. Well understood and practiced in your demo account ..

Press the F9 key to order in Metatrader, or CLICK 2x on its currency in the Market Watch screen

Suppose you want to open sell position on the EURO / USD


At 6 pm the position of EUR / USD at a price of "Bid / Ask = 1.3776/1.3778

Bid (Sell) = 1.3776, Ask (Buy) = 1.3778

Symbol: the name of the currency to be traded
volume: the lot size is used, the standard account is 0.10 that means every price movement is worth $ 1.

0.2 if it's one point worth $ 2, and so on.
Stop loss is stopped automatically at prices so (that is loaded) to minus position.

Take Profit is stopped automatically at prices so (loaded) for the position plus. To fill, easy, that's no small arrow next to them for setting the price at our mengambilprofit automatically (if the price touched), before you have to click the first "copy as".
Clear the Comment wrote ah, no coment
Type: Well there are several options ...
Instant Execution was to take short positions or buy to live in love, just click what you'd like to buy or sell traded. Now it is under buy sell to the click as the "brush" profit or loss discard.
Pending Order that for the price of the message. Read wrote in a posting on this blog wrote it?
Multyple close biarin wrote it, do not need to be discussed. not important.

You will open a sell position for example,
(At that time we order pairs of the position of the Bid (Sell) at rate 1.3776), and afterwards in our portfolio will account directly (minus) -2 floating point spread because there is this difference. (the difference between his buy and sell prices)

Then after that in the hours of 7 pm position EUR / USD turns into:
Bid (Sell) = 1.3756, Ask (Buy) = 1.3758

In this example, we will get a profit of 1.3776 - 1.3758 = 18 pips / points

  • If we order the Bid (Sell), and then if its ask price (Buy) move down smaller than the original price of our Bid, then we will get the profit.

  • When you order with Ask (Buy), and then if its Bid (Sell) to move up beyond the original price of Ask us, then we will get the profit.

  •  But if otherwise it will Loss (or Floating Loss)

Floating prices is if we have not diclose position (diliquid to be realized) and still in a position to move the floating market.

Wednesday, November 27, 2013

Fundamental analysis and the term

Fundamental Analysis

In the next lesson, we learned menegenai fundamental analysis. Is it? Let us read ...

Fundamental analysis basically took the approach adjacent news or rumors circulating in the market, As we kethui with financial markets such as stocks and money markets are very sensitive denganberita being circulated in the market. So what happened to the FOREX market trading. It can even be said that the exchange rate moves are the news. In other words, market news is the driving emotion that resulted in changes in the balance point in the exchange rate.

If you are a layman, perhaps we are not too concerned with the rise in U.S. interest rates, for example. But tidakbagi a trader. Central Bank interest rate hike by the Fed (U.S. central bank) could mean stronger U.S. dollar to hundreds of points, which means that's where the money can be obtained. Or conversely, a loss may occur if action is not taken in accordance with the market.

That's why news / news greatly affect the investment portfolio of a forex trader, then it's time you also learn fundamental analysis.

There is a logical flow and economic laws that apply here. (Although sometimes it is not 100% effective in fact, fundamental analysis relates not only to the logical thinking of monetary policy or news coming out but also how the market reacts to the news aka the psychology of the market).

Glossary - Term Fundamental Analysis

If you do not know about this business, please read this page

Federal Open Market Committee (FOMC)

Institutions are part of the Federal Reserve (U.S. central bank), which sets interest rate policy and credit. The FOMC is the policy making body of the most important in the Federal Reserve system. Institutions that currently chaired by Ben Bernanke's usually periodically held eight meetings a year to decide
whether or not a change in monetary policy.

FOMC Minutes

Is the announcement from the Federal Reserve which describes meetings
held U.S. monetary policy making institutions before.

 Business Inventories

Inventory figures that have been produced but not yet sold. Is one component in the calculation of GDP, and may provide important clues about the direction of the economy in the future.

Consumer Price Index (CPI)

Is data that measures the average change in prices paid by consumers (in average) for a variety of goods and services (approximately 200 kinds of categories). CPI is an inflation indicator most commonly used and well regarded as an indicator of the effectiveness of government policy. The rising CPI indicates that rising inflation will lead to decline in bond prices and rising interest rates.

Unlike other indicators of inflation, which only cover items of local production, CPI also includes imported goods. The disadvantage was the small number of samples taken. The analysts usually focus more on the core (core) CPI, CPI variant that does not include the components of the change in price is the least stable. Core CPI assessed
more accurate in measuring the rate of inflation.

Consumer Confidance

This data measures the level of consumer optimism on the economic performance. On
Generally, Consumer Confidence will be high if low unemployment and high GDP.
Data (change) per month is considered to be no significant impact on the trend in

Durable Goods Orders

Data is to calculate the volume (in dollars) of orders and delivery of goods, including durable categories (items which benefit the age of 3 years or more).

Factory Orders

Data is to calculate the value (in dollars) orders (order) new durable goods (durables) and not durable (non-durable). These data provide a more complete report than data Durable Goods Orders are released a week or two earlier.
Goods orders data gives an idea of ​​just how sibukkah sector
industry in the next few months to fulfill the order. Automated so greater data rate means increasing levels of demand. This means that the economy will be getting better.

Domentic Gross Product (GDP)

GDP measures the market value of goods and services produced in a country, without
consider national companies that produce goods or services. GDP consists of four main components: consumption, investment, government purchases, and net total exports.

GDP released per quarter, this data shows the percentage rate of growth in the previous quarter. The GDP report is divided into three releases: 1) advanced - first release, 2) preliminary first-revision, and 3) final - the second and final revision. These revisions are usually significant effect on the market.

 Housing Starts & Building Permits

Housing starts are monthly data to calculate the amount of the construction of housing units
new per month. Most of the data collected from the Housing Starts number of applications and licenses (permits) for the construction of houses.

This data includes the main indicators. The importance of these data lies in its ability to trigger changes in economic conditions, changes in predicted growth rate.
The fall in the number of new housing units could slow the economy and encourage the
direction of recession. Conversely, an increase in the number of new housing units indicates
economic growth.

The monthly increase in more than forecast interpreted as an indication of rising inflationary pressures.

Institute for Supply Management (ISM)

Formerly known as the NAPM, effectively unchanged since January 2002.

Is an important survey on U.S. manufacturing activity conducted by the Institute forSupply Management (ISM). The report is usually issued on the first working day of each month, providing a detailed view of the beginning of the manufacturing sector prior to the issuance of another employment report.

This survey is known for its accuracy timeliness (time period) it, the breadth of information available, and the numbers listed on its headline is a function of six major components:
price paid, new orders, supplier deliveries, production, inventories, and employment. It should be noted, the three last components reflects the power supply (supply), while the three previous components reflect the strength of demand (request).

It can be seen how the relative trend between the two groups (supply and demand) illustrates the balance between the two forces, and it provides a view to the policies of the Federal Reserve.

Component price paid (Price Paid) is widely considered as components
involve an element of price pressures in the sector, the number of 50 or more indicates that the sector is expanding, while a reading below 50 indicates a contraction.

Industrial Production

Industrial Production is a monthly data that measures the total production of the entire plant,
mining, and public service companies (electricity, water, gas, transportation, etc.).
Manufacturing Production, the largest component of Industrial Production Data, can be predicted accurately from the total hours worked from the employment report. One of the biggest drawbacks
of these data is the inclusion of component production level of public services that can be greatly affected by the change (eg climate change).

Increase more than forecast this indicator is defined as the increase in the inflation rate, which in turn will cause a drop in bond prices and rising interest rates

Capacity Utilization

Capacity Utilization is complementary Industrial Production data. Capacity Utilization
calculate the rate of use of capital used in production processes
This data up and down in line with the business cycle. Rising levels of production will cause a rise in this data as well. However, the very high level of difficulty in compiling these data lead to less market trust level accuracy

The increase exceeded the estimates of these indicators are interpreted as rising inflation, which in turn will cause a drop in bond prices and rising interest rates.

Leading Indicators

Is a combination of several other economic indicators. This index is designed to get a signal about economic trends are more up-to-date (current) and consistent.

Money Supply

Data is to calculate the amount of money circulating in the economy. Is the sum of:

• The amount of money in circulation in the form of coins or paper

• The number of loans from banks, to individuals, companies and other banks

• The amount of money borrowed by the government.

Monetary experts believe that Money Supply is a good indicator for
predict the rate of inflation. However, the correlation becomes unreliable since financial liberalization in '80s.

Non-Farm Payrools (NFP)

The number of new workers from non-agricultural sectors that work either full-time or part-time who earn wages / salaries of more than 500 authorized private and public companies.
This index reflects the performance of the commercial and industrial sectors. The higher the value
indicates the high level of economic growth.

Producer Price Index (PPI)

Is a set of indices that calculate the rate of change in the selling price of goods and services in a period of time received by domestic producers. PPI was calculated based on three areas of production: industry, commodity, and production of intermediate goods.

In short, the PPI measures the rate of price change from the perspective of the seller.

Not as good as the CPI indicates inflation pressures. But because components include items that are in the process of production, as well as PPI can often estimate the CPI.

Purchasing Managers' Index (PMI)

PMI is a composite index of the five main indicators, which include the following elements: Order, Level Inventory, Production, Shipping, and Labor. The index number above 50 means expansion of industry experience, below 50 means contraction.

This index is considered as an important indicator and is considered the best indicator to measure the level of production. This index can also detect the pressure of inflation and industrial activity.


Measuring changes in the quantity of goods and services produced per unit. Combining labor and capital inputs. Price unit of labor component is a useful indicator to measure the pressure on wages. The importance of productivity has grown in recent years since the Federal Reserve has started to pay attention to the trend growth and inflation.

Personal Consumption Expenditures - PCE

Approximately equal to the CPI, PCE was reported (more precisely a part of the Personal Income report) released by the Bureau of Economic Analysis of the Commerce Department. PCE measures the rate of price change of goods and services. Data components consist of household cash expenditures and credits for all kinds of good durable, non-durable, and services.

Retail Sales

These data to calculate the total receipts of retail stores, without including the component
expenditures for the services sector in it. Monthly data shows the percentage of
change from the previous month's data. Negative numbers indicate the number of sales decreased from the previous month's sales. Revision of the data that has been released can lead to significant price fluctuations.

Trade Balance

Trade balance is the net difference between the value of exports and imports of goods and services a country in a given period. A positive number indicates a surplus (exports exceed imports), negative indicates a deficit (imports exceed exports).

University of Michigan Consumer Sentiment Index

Is the result of a survey of consumer confidence conducted by the University of Michigan. Is an indicator of consumer confidence in America the most attention.

Consumer confidence is an important indicator for the business cycle because it presents important information about consumers' assessment of the current situation and expectations in the

Survey data collected by mail questionnaire to 5,000 households across the country as a representative sample, approximately 3,500 of which responded. The questionnaire contains five questions: (1) rating business conditions in the household, (2) rating business conditions in six months, (3) the availability of jobs in the domestic environment, (4) availability of employment in the next six months, and (5) family income in the past six months.

Consumer Confidence is closely related to the unemployment rate, inflation, and
real income. Generally, consumer confidence high when low unemployment and high GDP growth rates.

Financial markets interpret this index as the increased number of indications will increase the level of consumer spending. The high level of spending in turn could trigger inflation.

 Unemployment Rate

Is the percentage of job seekers compared to the total population. Although it is the data
which is commonly known (as simple and there are political implications), Unemployment
Rate relatively less important for the market because it is considered less accurate (often late
signaling changes in economic trends).

Weekly Initial Jobless Claims

Is the average number of weekly new claims for unemployment benefits.
These data provide a report up-to-date, though also often wrongly, about the trends
economy, with an increase (decrease) in these data potentially indicate
slowdown (accelerated) growth rate of labor.

Due to be released weekly, this data can be very sensitive and volatile. Analysts more
selecting moving average per 4 weeks of data to get more accurate results.