Top 5 Most Market Moving Indicators For The USD

When it comes to the currency market, most traders will use either technical or fundamental analysis or a combination of both to formulate their strategy, However, even for the casual currency trader, news or event risk can have a dramatic influence on the long and short-term price action of a currency pair.

In this report, we examine the 5 most market moving indicators for the US dollar (we update this report annually) against the Euro. The reason for our focus on the EUR/USD is its status as the most actively traded - and therefore benchmark – currency pair.

Economic Data is Important for Both Fundamental and Technical Traders

It is irrefutable that news or economic data can elicit a sharp reaction from currencies and other financial markets. However not all economic data is created equal. The monthly Non–farm payrolls for example has had a far bigger impact on the US dollar than other perennial top market movers like consumer prices. Indicators rarely keep their same level of influence over a currency though; so it common to see major shifts in the top ranking from year to year.

For example, over the past year, the worst contraction in the US housing market in a quarter century has led indicators like new and existing home sales to crowd out top releases from previous years – like ISM manufacturing. Also, what may create a lasting move in a currency on a day to day basis could be different from what triggers a knee jerk reaction in the US dollar. The top 5 most market moving indicators for the US dollar on a day to day basis are:

1. Non-Farm Payrolls
2. ISM Non-Manufacturing
3. Personal Spending
4. Inflation (Consumer Price Index)
5. Existing Home Sales

Unlike the other numbers, the non-farm payrolls report consistently topped the list of most market moving indicators for the US dollar. As the US economy slowed in 2007 and into 2008, the stability of the labor market was closely watched by all traders and analysts because of its broad ramifications for the overall economy.

[Partnership With ForexGen]

ForexGen offers three types of business partnerships:

*Introducing Broker
*White label
*Money Manager

ForexGen Introducing Brokers, White Label and Money Manager holders are recognized as a strategic business partners. The main focus of our service is to satisfy our partner's needs in order to deal with a qualified service and gain a huge income sharing plan.

[ForexGen] provide appropriate services satisfying the needs of all business partner's specified situation and requirements.

The Most Popular Indicators Used in Forex

Moving Average Convergence/Divergence (MACD)
What is it?

The MACD is one of the most popular oscillator used by currency traders. This is a momentum indicator can be used to confirm trends, while also indicating reversals, or overbought/oversold conditions. The MACD is calculated by taking the difference between the 2 exponential moving averages. The two that is usually used are the 26-day and 12-day moving averages.

How can MACD be used for trading?

Crossovers
The most common way to use the MACD is to buy/sell a currency pair when it crosses the signal line or zero. A sell signal occurs when the MACD falls below the signal line, while a buy signal occurs when the MACD rallies above the signal line.

Overbought/Oversold
The MACD can also be used as an overbought/oversold indicator. When the shorter moving average moves away significantly from the longer moving average (i.e., the MACD rises), it is likely that the currency price’s movements are starting to exhaust and will soon return to more realistic levels.

Divergences
When the MACD diverges from the trend of the currency price, this may signal a trend reversal. In addition, if the MACD makes a new low while the currency pair does not also make a new low, this is a bearish divergence, indicating a possible oversold condition. Alternatively, if the MACD is making new highs while the currency pair fails to confirm these highs, this is a bullish divergence, indicating a possible overbought condition.

Lowest Spreads ( ForexGen )
ForexGen offers 1 pip spread
on 10 pairs with high trading
techniques that make ForexGen
incomparable to any other rival.

[ForexGen Adcademy]
Get your Forex education
through ForexGen Academy
and acquire the chance
to master your trading skills.

Mulyi Terminal
[ForexGen] released it's new
platform that's designed to
manage multiple accounts to
be used by Money Managers
and Introducing Brokers.

ForexGen | Hedging Technique

A hedge is a position or combination of positions in one security that reduces the risk of your primary position in the same security.

An example of hedging in commodity futures is the Midwest farmer who grows #1 Soft Red Wheat and intends to take his harvest physically to market for September delivery. After rilling the soil and planting the seeds in late spring, die farmer initiates a short (sell) commodity futures contract for September Wheat at the Chicago Board of Trade at what he feels is a fair price. If the price of wheat declines dramatically in September, the farmer will suffer losses on his physical delivery but will make profits on his futures contract. If the price of wheat rises substantially in the fall, the farmer will make profits on his physical delivery but will suffer losses on his futures contract. Thus, hedging not only reduces risk but can also be used to lock in predetermined profits in some situations.

Normally when you have an open position to buy or sell at your FOREX dealer, and you open a new position in the opposite direction, the two positions will close each other out. If you had a position for USD/CHF to buy and you opened a new position USD/CHF to sell, both positions would close, since you cannot be buying and selling currencies at the same time. The feature of hedging however, allows you to do exactly that if your FOREX dealer offers this trading feature.

ForexGen Trading Strategy

The idea behind this simple Forex trading system is to capture an early move of the price when it starts to establish its new direction/trend for the day.
As we know the Frankfurt market opens at 2:00 am EST (which is 7:00 am GMT), then an hour later the other giant - London market opens at 3:00 am EST (which is 8:00 am GMT). The European session is the first major session for each coming day.

So, what do we do?We start with 1 hour time frame, preferred pair - GBP/USD and no indicators.The price range we are going to focus on is from 1:00 am EST to 2:00 am EST.We look for the highest high and the lowest low of the price in that range and simply draw parallel horizontal lines through those extremes that will create a tunnel.
Now we are ready to move to a smaller time frame - 5 minute chart - and watch for the whole 5 min candle to close outside the tunnel which will provide a signal for us to enter with the open of the next candle.
We use a 20 pip stop OR the other side of the tunnel - whichever is less.