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HOW To Trade CurrencyIllustrated below for the beginner is an example of how to calculate a profit in forex currency trading.Say for example you believe that the Euro might appreciate in value against the US Dollar in the near future and the current exchange rate is EUR/USD = 1.4210. You then decide to buy 100,000 Euros (1 standard lot).EUR 1.00 = USD 1.4210100,000 x 1.4210Your purchase of 100,000 Euros is US $142,100At 100:1 leverage your required margin deposit is $1,421ProfitLater on, as expected, the Euro appreciates by 75 pips to EUR/USD = 1.4285. You then decide to sell your Euros and exchange them back into US Dollars.EUR 1.00 = USD 1.4285100,000 x 1.4285You will get: US $142,850Your profit = ($142,850 - $142,100) = $750When starting out with forex currency trading it's a good idea to begin with some lower amounts until you have figured out exactly what you're doing as it can be difficult for most beginners. You can always increase the amounts once you gain the experience and skills necessary to make larger trades successfully.It is also beneficial to take some time to decide what currency pair or pairs you want to trade with. Generally no more than 2 to begin with to allow you ample opportunity to learn how the pairs actually relate to each other and ensure you are able to clearly identify the patterns that they follow. Beginners can increase to more pairs once they have a firm grasp of the basics of forex currency trading.
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WORLD FOREX
Dollar Falls Versus Yen, Euro On
Profit-Taking
TOKYO (Dow Jones)--The dollar declined against the yen and euro in Asia Thursday as players sold the U.S. unit to lock in profits after its overnight rise.
Players also sold the dollar in reaction to news that Russia and Brazil are planning to reduce their U.S. Treasury holdings in favor of new International Monetary Fund securities, dealers said.
Some traders also mentioned the continued rise in oil prices as a dollar-negative factor. The price of Nymex crude futures rose above $72 per barrel for the first time since October. "That hurts the dollar because it raises concerns going forward about inflation, and the U.S. would be in the weakest position to cope," given its massive fiscal stimulus spending and ultra-low 0-0.25% policy rate, said Yuzo Sakai, manager of foreign exchange business promotion at Tokyo Forex & Ueda Harlow. At 0450 GMT, the U.S. unit traded hands at Y97.77 compared to Y98.28 late Wednesday in New York. The euro stood at $1.4050 compared to $1.3987. Dollar weakness is likely to persist, some dealers said, citing growing concern that lingering weakness in U.S. domestic demand may postpone any overall economic recovery. "My gut feeling is that this is going to keep the dollar weak, at least until August or so," said Hideki Amikura, deputy general manager of Nomura Trust and Banking.Most dealers agreed the U.S. unit is unlikely to make major breaks in either direction for the rest of the week. Into the weekend, it may trade in a Y96.50-Y98.50 band, while the euro may consolidate in a $1.3800-$1.4100 range, said Satoshi Tate, senior vice president of the foreign exchange division at Mizuho Corporate Bank.
Players are now watching U.S. May retail and food sales, due at 1230 GMT, to gauge conditions in consumer demand. Economists surveyed by Dow Jones Newswires forecast a 0.5% rise. Some dealers said a weaker-than-expected showing could further drag on the greenback.
Interbank Foreign Exchange Rates At 00:50 EDT / 0450 GMT
Latest Previous %Chg Daily Daily %Chg
Dollar Rates 2150 GMT High Low 12/31
USD/JPY Yen 97.75-81 98.13-17 -0.39 98.29 97.74 +7.89
EUR/USD Euro 1.4048-53 1.3981-84 +0.48 1.4060 1.3962 +0.50
GBP/USD Sterling 1.6423-25 1.6356-61 +0.41 1.6433 1.6342 +12.29
USD/CHF Swiss Franc 1.0757-66 1.0804-07 -0.44 1.0823 1.0756 +0.82
USD/CAD Canadian Dlr 1.1034-39 1.1075-81 -0.37 1.1102 1.1034 -9.30
AUD/USD Australian Dlr 0.8110-13 0.8036-38 +0.92 0.8121 0.8015 +14.66
NZD/USD New Zealand Dlr 0.6373-76 0.6269-74 +1.66 0.6376 0.6291 +9.22
EUR/JPY Yen 137.35-40 137.22-26 +0.09 137.6
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