NZ dollar gains on GDP data, bonds lower

WELLINGTON, Sept 26 (Reuters) - The New Zealand dollar gained as better-than-expected data suggested the economy will only suffer a shallow recession, while the U.S. dollar dipped as talks on a financial sector rescue package stalled.


* NZ dollar gains around half a cent to a high of $0.6880 after data showed the NZ economy was in recession in the first half of the year, but the contraction was not as big as feared.

* U.S. dollar falls against the yen and the euro as wrangling between lawmakers over the U.S. government's proposed $700 billion bailout plan continued.

* NZ second-quarter gross domestic product data showed activity fell by a less-than-expected 0.2 percent against market expectations of 0.5 percent.

* Data raises hopes the recession will be a shallow one with another quarter of weakness likely before a return to growth in fourth quarter.

* GDP data not seen altering the outlook for further Reserve Bank of NZ rate cuts given the more pressing impact of the global financial turmoil. A rate cut of at least 25 basis points seen certain at October rate review, with significant risk of a 50 basis point cut.

* NZ Finance Minister Michael Cullen says economy likely to resume growth again by the end of the year.

* Short-term support for the NZ dollar seen at $0.6820 with resistance at $0.6900.

* NZ data calendar thin next week with August trade, building consents, and latest National Bank of NZ confidence survey.

* New Zealand bonds turn soft, partly on the better-than-expected GDP data, with yields up to three basis points higher.

* NZ two-year swap rate at 6.98/7.01 percent compared with Thursday's 7.0 percent.

* NZ goes onto daylight saving on Sept. 28, with clocks going forward one hour to be 13 hours ahead of GMT.

Forex News

SEOUL, Sept 26 (Reuters) - The South Korean won gave up its limited early gains against the dollar by midday on Friday, with traders remaining cautious over the uncertainty surrounding a proposed $700 billion lifeline for the U.S. financial sector.

The country's finance minister on Friday issued a renewed pledge to help ease dollar funding shortages and another ministry official said the authorities would inject at least $10 billion into the swap market over the coming weeks.

The costs of dollar funding in the local swap market continued to fall after the remarks, but lingering doubts about an early implementation of the proposed $700 billion U.S. financial bailout plan kept undermining the won.

The won was quoted at 1,158.2/9.0 per dollar at 0300 GMT, unchanged from Thursday's domestic close of 1,158.2, after rising to as high as 1,148.8.

'The market's players as a whole remain worried about where the global markets are headed, and the won is not expected to make a major turnaround soon,' said a foreign bank dealer.

The Seoul stock market's benchmark KOSPI dipped 1.6 percent due to persistent concerns about the U.S. and global financial markets, with foreign investors net sellers of more than 100 billion won worth of local shares

Forex Training

Forex Market Overview How the forex market has developed, why it presents an outstanding trading opportunity, and how it compares to futures markets.

Trading Strategy and Decision Making Fundamentals of developing a basic trading strategy, including examples of some of the most common techniques.

Controlling Risk One of the most fundamental factors in successful trading is controlling risk. Learn how to limit downside both strategically and mechanically.

Currency Options Trading Learn about options fundamentals and how to trade options on GCI's online trading platform.

Glossary and Definitions and Terms Definitions of the most common foreign exchange terms, including technical studies and currency pairs.

GCI Daily Market Research Stay informed of current market conditions, support and resistance levels, and fundamental commentary on the major currencies.

GCI Forex Resources

FOREX-Dollar dips on U.S. bailout plan uncertainty

TOKYO, Sept 26 (Reuters) - The dollar fell against the yen and the euro on Friday as a deal to rescue the U.S. financial system stalled, souring hopes for an imminent agreement to resolve the banking crisis.

U.S. lawmakers had appeared close to a final agreement on Thursday on a massive $700 billion bailout to save the financial system, but things spun off course during an emergency White House meeting between Congressional leaders with U.S. President George W. Bush.

Negotiations toward a Wall Street bailout fell into disarray late on Thursday after Republican president candidate Sen. John McCain backed a new plan differing markedly from the one that has been under discussion.[ID:nN25133375]

Congressional leaders said an agreement could take until the weekend or longer, sending U.S. stock futures down sharply in Asian trading, hurting the dollar.

'The change in the mood about the imminent agreement on the U.S. bailout plan is adding to the weakness of the dollar against the yen,' said a trader at a Japanese bank.

News that Washington Mutual was closed by U.S. authorities and its assets sold in America's biggest ever bank failure also hurt the sentiment towards the greenback.

The third-largest U.S. bank JPMorgan Chase & Co said it bought the deposits of Washington Mutual which has seen its stock price virtually wiped out because of massive amounts of bad mortgages.[ID:nSP335584]

The dollar fell 0.6 percent to 105.87 yen, near day's low, but stayed in a rough range of 105-108 yen this week.

Traders said selling came mostly from speculators who create and close positions in the short term, while many investors avoided big directional bets in recent volatile sessions

Mini Forex

Rapid and fair trade execution. Market orders are confirmed within seconds at prices clicked on or accepted by the client. Furthermore, GCI has a "zero slippage guarantee" for all Forex Stop and Entry Stop orders that are placed at least one minute before the market reaches your specified price.

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Tight 3 - 4 pip spreads. Clients can trade on 3 - 4 pip spreads in major currencies and crosses, 24 hours a day.

Broad offering of financial products. In addition to currencies, you can trade mini versions of Dow Jones, Gold, S&P 500, other equity indices from your Mini Forex account. Trading opportunities and profit potential are that much higher. Click here for a full list of products and specifications.

$2000 minimum account balance. GCI provides access to spot forex trading for individuals as well as institutions. Margin requirements are $50 per lot.

Risk is limited to deposited funds. GCI's sophisticated margin and dealing procedures mean that clients can never lose more than their funds on deposit.

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Example Trade in your life..

Assume you have a trading account at a broker that requires a 1% margin deposit for every trade. The current quote for EUR/USD is 1.3225/28 and you want to place a market order to buy 1 standard lot of 100,000 Euros at 1.3228, for a total value of US$132,280 (100,000 * $1.3228). The broker requires you to deposit 1% of the total, or $1322.80 to open the trade. At the same time you place a take-profit order at 1.3278, 50 pips above your order price. In taking this trade you expect the Euro to strengthen against the U.S. dollar.

As you expected, the Euro strengthens against the U.S. dollar and you take your profit at 1.3278, closing out the trade. As each pip is worth US$10, your total profit for this trade is $500, for a total return of 38%

Margin

The deposit required to open or maintain a position. Margin can be either "free" or "used". Used margin is that amount which is being used to maintain or open a position, whereas free margin is the opposite. With $1,000 in your account and a 1% margin requirement to open a position, you can buy or sell a position worth up to $100,000. This allows a trader to leverage his account by up to 100 times or 100:1. If your account falls to below the minimum amount required to maintain an open position, you will receive a "margin call" requiring you to either add more money into your account or close the open position. Most brokers will automatically close your open positions when the margin balance falls below the amount required to maintain the open position. The amount required to maintain an open position is dependent on the broker and could be 50% of the original margin required to open the trade.

Leverage

Leverage is the ability to gear your account into a position greater than your total account margin. For instance, if a trader has a $1,000 margin balance in his account and he opens a $100,000 position, he leverages his account by 100 times, or 100:1. If he opens a $200,000 position with a $1,000 margin balance in his account, his leverage is 200 times, or 200:1. Increasing your leverage magnifies both gains and losses.

To calculate the leverage used, divide the total value of your open positions by the total margin balance in your account. For example, if you have a $10,000 margin balance in your account and you open one standard lot of USD/JPY (100,000 units of the base currency) for $100,000, your leverage ratio is 10:1 ($100,000 / $10,000). If you open one standard lot of EUR/USD for $150,000 (100,000 x EUR/USD = 1.5000) your leverage ratio is 15:1 ($150,000 / $10,000).

Common Order Types

Market Order

An order to buy or sell at the current market price.

Limit Order

An order to buy or sell at a pre-specified price level.

Stop-Loss Order

An order to restrict losses at a pre-specified price level.

Limit Entry Order

An order to buy below the market or sell above the market at a pre-specified level, believing that the price will reverse direction from that point.

Stop-Entry Order

An order to buy above the market or sell below the market at a pre-specified level, believing that the price will continue in the same direction.

OCO Order

One Cancels Other. An order whereby if one is executed, the other is cancelled.

GTC Order

Good Till Cancelled. An order stays in the market until it is either filled or cancelled.

Example Trade

Assume you have a trading account at a broker that requires a 1% margin deposit for every trade. The current quote for EUR/USD is 1.3225/28 and you want to place a market order to buy 1 standard lot of 100,000 Euros at 1.3228, for a total value of US$132,280 (100,000 * $1.3228). The broker requires you to deposit 1% of the total, or $1322.80 to open the trade. At the same time you place a take-profit order at 1.3278, 50 pips above your order price. In taking this trade you expect the Euro to strengthen against the U.S. dollar.

As you expected, the Euro strengthens against the U.S. dollar and you take your profit at 1.3278, closing out the trade. As each pip is worth US$10, your total profit for this trade is $500, for a total return of 38%.

Why "Follow-Through" Is Imperative For Your Market Position

Endurance is counted as a high merit in great accomplishments, especially in forex trading. Great men frequently advise to be consistent in big changes of market tendencies and "Follow Through" in breakthroughs.

2007 Ford Edge HySeries Concept Road Test

If you want to look at promising cars that are on sale today, look no further than

Looks like an Edge, but there's much more to it. (Photo: Justin Couture, American Auto Press)the Ford Edge. It currently stands proudly in the number one position atop the crossover sales charts, selling a remarkable 130,000 units in the United States last year since it was launched - and a handful or two in the Middle East and Asia. But if you want to look at what cars hold promise for tomorrow, also look no further than the Ford Edge... this Ford Edge.Besides looking a little like an earth-bound space ship, this particular Ford Edge is special. It's the only one in the world that's been converted from gasoline to run on hydrogen and electricity. It's one of over two-dozen hydrogen-powered vehicles that Ford has built over the past decade, and like the rest it's out on the road being tested for durability, gathering data. What makes it even more special is that it integrates the much-talked about series hybrid drivetrain with a Ballard fuel cell.Without getting to in depth and technical, a series hybrid isn't at all like the

There's no gasoline - or tailpipe emissions - here. (Photo: Justin Couture, American Auto Press)hybrid that roams about on streets today; those are parallel hybrids. It shares the same rough definition of hybrid in that it runs on more than one type of power, but unlike, say, a Prius which uses both a gasoline-powered engine and an electric motor to propel it, a series hybrid's propulsion comes strictly from its batteries. When the charge of the batteries is on the way to depletion, a power source - an internal combustion engine, or, in the case of the HySeries, a hydrogen fuel cell - fires up, acting like a generator to charge the batteries back up. In much fewer words, it's like an electric car that's got its own hydrogen-fueled power station. Conceptually, it's the same sort of thing you'll find in GM's much hyped E-Flex system in the Chevrolet Volt, though there are two key differences, the first being that the Edge HySeries is fully functioning and has racked up nearly 10,000 miles in the process, and two, that it runs on hydrogen, not gasoline (though a fuel-cell Volt has appeared in concept form, with China as a targeted market).

WHAT IS FOREX....?

FOREX = foreigns ex change
You can trade 24 hours a day
The FOREX is larger than all other financial markets COMBINED
The Foreign Exchange (FOREX) market is a cash (or “spot”) interbank market established in 1971 when floating exchange rates began to materialize. This market is the arena in which the currency of one country is exchanged for those of another and where settlements for international business are made.The FOREX is a group of approximately 4500 currency trading institutions, including international banks, government central banks and commercial companies. Payments for exports and imports flow through the Foreign Exchange Market, as well as payments for purchases and sales of assets. This is called the “consumer” foreign exchange market. There is also a “speculator” segment in the FOREX Companies, which have large financial exposures tooverseas economies participate in the FOREX to offset the risks of international investing.Historically, the FOREX interbank market was not available for small speculators. With a previous minimum transaction size and often-stringent financial requirements, the small trader was excluded from participation in this market. But today market maker brokers are allowed to break down the large interbank units and offer small traders the opportunity to buy or sell any number of these smaller units (lots).

What's Forex?

"Forex" stands for foreign exchange; it's also known as FX. In a forex trade, you buy one currency while simultaneously selling another - that is, you're exchanging the sold currency for the one you're buying. The foreign exchange market is an over-the-counter market. Currencies trade in pairs, like the Euro-US Dollar (EUR/USD) or US Dollar / Japanese Yen (USD/JPY). Unlike stocks or futures, there's no centralized exchange for forex. All transactions happen via phone or electronic network.