Saturday, August 20, 2011

Is Forex a dirty word?

Recently I came across an interesting article entitled "The G-7 Forex Intervention Is A Perfect Example Of How Manipulated The Global Currency Market Really Is" by Michael Snyder. I have to confess it made for interesting reading but was by no means a revelation. The examples used within his article in respect to the BOJ intervention in agreement with other members of the G-7 to clearly participate has been voiced in various media sources. On the grand scale though of a market place in which the daily turnover is in the order of 4 trillion dollars we the private investors make very little noise' compared to Governments and larger banking institutions that throw billions in one hit into the market place. Even with such horrendous amounts of money funneled still only moves the market for a given time depending on sufficient orders continuing to keep the momentum going. Is this a good or bad thing? What would happen to the market (and this is purely hypothetical) if no large institutional money was put into it. The result would be very little forex movement whatsoever. So given this, is it such a bad thing? Not necessarily, just as you cannot go anywhere in a parked car, if the market didn't move we wouldn't make (or lose) money either. In fact forex would become a total waste of time. The bottom line is we need the big player intervention so we can ride on their money (which fuels the forex trends).     


Percentage gain/loss as of 13.8.11 = +6.56%
Profit Factor = 0.92

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