WORLD FOREX: Dollar Climbs Above Y84 On Korea Tensions
The dollar surpassed the Y84 mark Friday for the first time since Sept. 29 as Korean peninsula tensions caused investors to bolt from the yen, and gained against the euro as investors reacted to fresh signs of strain in the euro zone.
Fear of an escalation of Korean tensions has fed a recent push into the dollar from the yen, because of the proximity of Japan to the conflict and the dollar being still considered a safe harbor in times of stress, analysts said.
Explosions were heard in Yeonpyeong Island Friday afternoon, and smoke was visible on the coast of North Korea, three days after a North Korean artillery barrage killed four people on the remote South Korean island. North Korea has warned the U.S. its plans for naval exercises with the South will drive the peninsula "closer to the brink of war," according to Sky News.
The dollar had been under pressure against the yen for most of the year, so this new trend marks a significant reversal, said Steven Englander, head of G10 strategy at Citigroup in New York.
Earlier this year, the yen had gained from worldwide risk aversion, in its traditional role as the ultimate safe-haven currency, while concerns over dollar-diluting Federal Reserve stimulus measures in early fall had also pushed the dollar sharply lower against the yen, said Englander.
"But the arguments they had [for that trade] are now very stale, and now they have a reason to move away from it," with concerns over Korea, he said.
Friday afternoon, the euro was at $1.3231 from $1.3369 late Thursday, according to EBS via CQG. The dollar was at Y84.01 from Y83.56, while the euro was at Y111.16 from Y111.75. The U.K. pound was at $1.5611 from $1.5764. The dollar was at CHF1.0026 from CHF1.0000.
The ICE Dollar Index, which tracks the greenback against a trade-weighted basket of currencies, was at 80.384 from 79.640.
"[A] symphony of negative headlines" from across the world fed a broad move into the dollar Friday, across currency pairs, said Mark McCormick, currency strategist with Brown Brothers Harriman in New York.
The euro sold off nearly 1% on the news from Friday's Financial Times Deutschland claiming euro-zone countries and the European Central Bank are applying pressure on Portugal to accept aid akin to Ireland's discussed rescue package.
Portugal, Spain and the European Commission denied the report. But growing market speculation that Portugal may be the next country to ask for support from its euro-zone neighbors has rocked confidence in the common currency, several analysts said.
News from the euro zone "highlights the fact the fear of contagion is moving to reality," said Camilla Sutton, currency strategist at Scotia Capital in Toronto.
Sterling also traded down by 1% to new two-month lows against the dollar. The dollar traded near two-month highs against the safe-haven Swiss franc.
The U.K. economy is inextricably linked to the roiled euro zone and investors are punishing the sterling for this correlation, said Lena Komileva, head of G7 market economics at Tullett Prebon in London. Specifically, "there is huge exposure by the U.K. banking sector," to Irish government debt, she said.
The strong move into the dollar has created a move away from other safe-haven assets, which include the Swiss franc and gold, said Komileva.
Also, Glenn Stevens, governor of the Reserve Bank of Australia, said no further rate increases are being considered in the near term during testimony to Parliament. That stoked concern that the commodity-driven Chinese global-growth-led economy may be cooling off, a negative omen for a global recovery in general, analysts said. That news caused the Australian dollar to sell off roughly 1.8% against the U.S. dollar.
Saturday, November 27, 2010
FOREX: US Dollar finishes week higher against major currencies
The U.S. dollar traded higher in forex trading this week against the other major currencies as the American currency was the beneficiary of risk aversion. Market jitters were triggered this week by a military clash between North and South Korea as well as debt fears in the Eurozone, particularly in Ireland, Spain and Portugal.
The dollar rode the risk aversion higher versus the euro for a third straight week as the euro (EUR/USD pair) fell to its lowest exchange rate since September 21st at the 1.302 level. The dollar also increased for the week versus the Swiss franc, British pound sterling, Canadian dollar and New Zealand dollar, Australian dollar and the Japanese yen.
The largest gain for the dollar was against the euro with a 431 pip increase for the week followed by a 391 pip advance versus the British pound sterling (see chart). The dollar also rose by over 200 pips against the Australian dollar and the New Zealand dollar.
The dollar gained ground for a third straight week against the British pound, the Canadian dollar and the Swiss franc.
The Japanese yen, meanwhile, lost ground for the fourth straight week versus the U.S. dollar with an approximate 48 pip shortfall. The USD/JPY pair now trades at the 84.02 exchange rate after declining to a low at the 80.22 exchange rate on October 31st.
The U.S. dollar traded higher in forex trading this week against the other major currencies as the American currency was the beneficiary of risk aversion. Market jitters were triggered this week by a military clash between North and South Korea as well as debt fears in the Eurozone, particularly in Ireland, Spain and Portugal.
The dollar rode the risk aversion higher versus the euro for a third straight week as the euro (EUR/USD pair) fell to its lowest exchange rate since September 21st at the 1.302 level. The dollar also increased for the week versus the Swiss franc, British pound sterling, Canadian dollar and New Zealand dollar, Australian dollar and the Japanese yen.
The largest gain for the dollar was against the euro with a 431 pip increase for the week followed by a 391 pip advance versus the British pound sterling (see chart). The dollar also rose by over 200 pips against the Australian dollar and the New Zealand dollar.
The dollar gained ground for a third straight week against the British pound, the Canadian dollar and the Swiss franc.
The Japanese yen, meanwhile, lost ground for the fourth straight week versus the U.S. dollar with an approximate 48 pip shortfall. The USD/JPY pair now trades at the 84.02 exchange rate after declining to a low at the 80.22 exchange rate on October 31st.
Friday, November 26, 2010
How to Deposit Funds with your Forex Broker
Most online Forex brokers are offering customers a wide variety of methods to deposit funds to their forex trading accounts. In addition to the very traditional deposit methods such as credit card, bank transfer, and personal or business check, many brokers are offering various web wallet systems. We generally list the available deposit and withdrawal methods for the particular brokers reviewed in the broker reviews section on forex-rates.biz.
Following are some of the web wallets that are rapidly growing in popularity as forex broker deposit methods, which are simple, convenient, and generally very secure:
Liberty Reserve
Liberty Reserve is a complete electronic currency, owned and operated by Liberty Reserve S.A. Liberty Reserve offers three e-currencies, one being on par with the US Dollar, the second being on par with the Euro, and the third being on par with one gram of gold. Liberty Reserve accounts require no identity documents to set up, and very limited personal information. To get funds in and out of the system, however, requires the use of a Liberty Reserve currency exchanger, which is independent from Liberty Reserve itself. To fund your Liberty Reserve account, you need to transfer funds to the exchanger, who takes a small fee and then transfers credits into your Liberty Reserve account. Similarly, to withdraw, you transfer Liberty Reserve to an exchanger's Liberty Reserve account, and they in turn deduct their fee and send funds back to your bank account. You never actually carry out any financial transactions directly with Liberty Reserve.
>> Signup a trading account with: ForexYard, eToro.com, AvaFX or Finexo.com
Moneybookers
Moneybookers is a popular online wallet, based in the United Kingdom and regulated by the FSA. It is operated by Moneybookers Ltd., which is owned by Investcorp Technology Partners. Moneybookers commenced business in 2001 and offers accounts denominated in USD, EUR, GBP, and CAD. Both personal and company accounts are allowed. Moneybookers offers several convenient ways to deposit to its online system from, as well as receive withdrawals back to, your bank account, regardless of where in the world your account is located.
>> Signup a trading account with: ForexYard, eToro.com, AvaFX or Finexo.com
PayPal
PayPal is arguably the first wallet system offered online, and certainly the largest and most popular. It is operated by PayPal Inc., which is owned by eBay Inc. PayPal accounts are based on the customer's e-mail address. A credit card or USA-based bank account is required to add funds to your account balance and to send payments to other customers. PayPal charges fees for receiving payments to your account, and also to withdraw funds from your Paypal account to bank accounts outside of the USA. Senders of Paypal payments do not pay fees if the transfer occurs to another Paypal account. Many forex brokers accept PayPal, but PayPal also has usage restrictions based on your country of residence, so it has limited use for a great many traders in various parts of the world.
>> Signup a trading account with: ForexYard, eToro.com, AvaFX or Finexo.com
WebMoney
WebMoney is more than an online wallet, it is a complete electronic currency system, operated by WM Transfer Ltd. WebMoney started off as an online payment system dedicated specifically to the Russian market, but it has grown into an internationally popular payment system with representatives throughout the world. The virtual currencies (popularly known as e-currencies) offered by WebMoney are WMZ (which is equivalent in value to the U.S. Dollar), WME (which is equivalent in value to the Euro) and WMR (which is equivalent to the Russian Ruble). WebMoney accounts are accessible via internet either using your web browser, or by using a special software offered to all WebMoney account holders that allegedly makes your use of the system much more secure. WebMoney processes more than 100 million dollars in transactions on a daily basis, and has millions of customers worldwide. An interesting feature of WebMoney is that accounts are anonymous, though withdrawing funds from the system does require personal identification on the part of the account holder.
Most online Forex brokers are offering customers a wide variety of methods to deposit funds to their forex trading accounts. In addition to the very traditional deposit methods such as credit card, bank transfer, and personal or business check, many brokers are offering various web wallet systems. We generally list the available deposit and withdrawal methods for the particular brokers reviewed in the broker reviews section on forex-rates.biz.
Following are some of the web wallets that are rapidly growing in popularity as forex broker deposit methods, which are simple, convenient, and generally very secure:
Liberty Reserve
Liberty Reserve is a complete electronic currency, owned and operated by Liberty Reserve S.A. Liberty Reserve offers three e-currencies, one being on par with the US Dollar, the second being on par with the Euro, and the third being on par with one gram of gold. Liberty Reserve accounts require no identity documents to set up, and very limited personal information. To get funds in and out of the system, however, requires the use of a Liberty Reserve currency exchanger, which is independent from Liberty Reserve itself. To fund your Liberty Reserve account, you need to transfer funds to the exchanger, who takes a small fee and then transfers credits into your Liberty Reserve account. Similarly, to withdraw, you transfer Liberty Reserve to an exchanger's Liberty Reserve account, and they in turn deduct their fee and send funds back to your bank account. You never actually carry out any financial transactions directly with Liberty Reserve.
>> Signup a trading account with: ForexYard, eToro.com, AvaFX or Finexo.com
Moneybookers
Moneybookers is a popular online wallet, based in the United Kingdom and regulated by the FSA. It is operated by Moneybookers Ltd., which is owned by Investcorp Technology Partners. Moneybookers commenced business in 2001 and offers accounts denominated in USD, EUR, GBP, and CAD. Both personal and company accounts are allowed. Moneybookers offers several convenient ways to deposit to its online system from, as well as receive withdrawals back to, your bank account, regardless of where in the world your account is located.
>> Signup a trading account with: ForexYard, eToro.com, AvaFX or Finexo.com
PayPal
PayPal is arguably the first wallet system offered online, and certainly the largest and most popular. It is operated by PayPal Inc., which is owned by eBay Inc. PayPal accounts are based on the customer's e-mail address. A credit card or USA-based bank account is required to add funds to your account balance and to send payments to other customers. PayPal charges fees for receiving payments to your account, and also to withdraw funds from your Paypal account to bank accounts outside of the USA. Senders of Paypal payments do not pay fees if the transfer occurs to another Paypal account. Many forex brokers accept PayPal, but PayPal also has usage restrictions based on your country of residence, so it has limited use for a great many traders in various parts of the world.
>> Signup a trading account with: ForexYard, eToro.com, AvaFX or Finexo.com
WebMoney
WebMoney is more than an online wallet, it is a complete electronic currency system, operated by WM Transfer Ltd. WebMoney started off as an online payment system dedicated specifically to the Russian market, but it has grown into an internationally popular payment system with representatives throughout the world. The virtual currencies (popularly known as e-currencies) offered by WebMoney are WMZ (which is equivalent in value to the U.S. Dollar), WME (which is equivalent in value to the Euro) and WMR (which is equivalent to the Russian Ruble). WebMoney accounts are accessible via internet either using your web browser, or by using a special software offered to all WebMoney account holders that allegedly makes your use of the system much more secure. WebMoney processes more than 100 million dollars in transactions on a daily basis, and has millions of customers worldwide. An interesting feature of WebMoney is that accounts are anonymous, though withdrawing funds from the system does require personal identification on the part of the account holder.
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