If you chart the course of the Australian Dollar over the last twelve months alongside the S&P 500, the overlap is jarring. You can see from the chart below that the two lines zig and zag in almost perfect unison. It would seem that there was a slight break in the second quarter of 2010, [...]

I shouldn’t have been so complacent in declaring the paradigm shift in forex markets, whereby risk aversion had given way to comparative growth and interest rate differentials. While such a shift might have been present – or even dominant – in forex markets over the last couple months, it appears to have once again been [...]

One of the cornerstones of exchange rate theory is that currencies rise and fall in accordance with inflation differentials. All else being equal, if US inflation averages 5% per annum and EU inflation averages 0% per annum, then we would expect the Euro to appreciate (or the Dollar to depreciate, depending on how you look [...]

One of the main themes (even if not always overt) of my posts recently has been the revival of the carry trade, if not the already extant revival than at least the imminent one. In this context, there is no better candidate than the Brazilian Real.
After a stellar 2009, the Brazilian Real opened 2010 in [...]

In January, the Canadian Dollar (aka Loonie) registered its worst monthly performance since June. Many analysts pointed to this as proof that its run was over, after coming tantalizingly close to parity. Others insisted that the decline was only a temporary correction, a mere squaring of positions before the Loonie’s next big run. Who’s right? [...]

According to statements made at today’s meeting of the Croatian and Slovenian PMs (Jadranka Kosor and Borut Pahor, respectively), Slovenia is ready to unblock Croatia’s negotiation process and allow the opening of the remaining chapters. The two countries seem to

Bulgaria is an up-and-coming country, both in general economic terms and as a tourist destination. Natural attributes such as a warm Mediterranean climate, beautiful coastline, winter sport resorts and picturesque scenery form the basis for its growing popularity and future potential as one of Europe’s leading destinations, but what makes Bulgaria especially interesting – to …

Traders in the Forex market generally rely on two basic forms of evaluation which are used to study the markets and predict price movement: fundamental and technical analysis.
Fundamental analysis is essentially the study of a nation’s overall economy. The idea of this “Big Picture” approach is that the strength of a nations’s economy will …

Of the many market sayings thrown around by traders, perhaps none is more overused and less understood than the old adage ‘the trend is your friend’.
All too often, the phrase is used after a trader has taken a counter-trend position and subsequently been stopped out at a loss. Remorse sets in at this point and …

Unlike other trading exchanges such as the NYSE, NASDAQ, and other major stock trading organizations, trading in the foreign exchange market can be extremely volatile on a day-to-day basis. It is crucial that anyone who is going to invest in the Forex market be as informed as possible on the global economic news of the …