The Forex market is a perfect trading platform for creating serious profits. However, with this potential of making money, it deals with the great danger as well. Many traders are misled by experts who have less information and spread false information. Sometimes Forex brokers who do not have done prior research also misled traders. So, you need to choose one from the Best Forex Brokers.

There are several misconceptions about forex trading are:

  • Forex can provide you with immediate profit, which is not true.
  • You can jump into the market without preparing yourself mentally and emotionally, without any comprehensive research.
  • You need to trade with HIGH LEVERAGE.

LEVERAGE is actually a synonym to DANGERS in Forex trading.

So let’s understand the concept first. Leverage is the use of borrowed capital to invest, presuming such that this profit should be higher than the payable interest.

In straight stock trading, you have to front up all the amount of the stock worth, while in Forex trading, you can use leverage, and with only a small fraction of your own money, you can enter into the trading.

Leverage is a kind of a loan provided by the broker to the client or investor.

For better understanding, let’s take an example, suppose you want to buy a vehicle, but you cannot afford to pay for it all upfront, you go to banks for a loan. The banks then ask for your salary statement to scrutinize whether you are competent in paying the monthly installments or not. The banks, therefore, are willing to allow you to leverage your salary and loan you the money you need to buy your vehicle.

In Forex trading, they offer you very high leverage, which draws a lot of people’s attention as compared to other trading instruments. But lack of understanding about this concept and without any comprehensive research, it might lead you to the danger of losing your money. But if you are well aware of the concept and spend adequate time on research, then it can provide you with a very powerful tool to build profits.

The most commonly used leverage amount is 100:1. In this case, if you want to buy a stock worth 100 dollars, then you have to front up 1 dollar only to enter into trading.

In countries like the US, the government has made strict rules where the buyers can only allow the client the maximum leverage of 50:1. But in several other countries, the brokers offer extreme leverage ranges from 50:1 to 1000:1, which will amplify the potential risk.

Uncertainty is one of the primary characteristics of the Forex market due to its volatility. Leverage actually makes that already high volatility of the Forex market even higher, which can be catastrophic to the investor. When trading with no leverage, the most important thing to remember is that the only possible way to lose your money is if the currency loses its value. The euro or the dollar would, of course, still be worth something, so the trading with no leverage is a pretty secure bet. Therefore some of the expert call leverage a double-edged sword.

In trading, you monitor the currency fluctuation in pips, which is considered as the slightest change in currency price, and it also confides in on the currency pair. These fluctuations in currency prices are just fractions of a cent. Suppose if there is a fluctuation of 100 pips from 1.9400 to 1.9500 when a currency pair like the GBP/USD moves, i.e., just a one-cent movement of the exchange rate.

This is why trading of currency transactions should be carried out in substantial amounts, enabling these slight price fluctuation to be converted into more enormous profits when magnified by leverage use. So when you deal with a large amount like $100,000, these small fluctuations in the currency’s price can result in significant profits or losses.

Conclusion

There’s no reason to be afraid of leverage once you have learned how to manage it. Trading with smaller leverage affords more breathing room. But trading with high leverage can ease depletion of your trading account if the trade goes against you, as you will end up with more significant losses because of the larger trading amount. So in last, you should always keep in mind that leverage is flexible and can be tailored to each trader’s needs.

Crédit Agricole, the French bank has announced on Tuesday that it is going to acquire more than 85% of stake in the fintech firm named Linxo Group. However, the amount of acquisition has not yet been disclosed by either of the companies. However, the proposal for acquisition is still pending for approval from the French Prudential Supervisory and Resolution Authority (ACPR).

Crédit Agricole Payment Services, along with FIRECA (Fonds d’Investissement et de REcherche du Crédit Agricole), which is the standing partner of Linxo Group for years, will be controlling the said acquisition. The directors and founders are said to hold the residual capital for the company’s development after the acquisition transactions are completed.

The acquisition will help Crédit Agricole to consolidate its position in digital payment services, and will also offer a robust account aggregation solution via the banking apps. On the other hand, Linxo Group will have the support of a top European banking group, which will help it to grow in the banking sector.

In fact, by collaborating the technological prowess of the Linxo Group with Crédit Agricole’s know-how, it will create new opportunities for digital innovation services based on the financial reports of Crédit Agricole.

Talking about this acquisition, Bertrand Chevallier, the CEO of Credit Agricole Payment Services said,

The acquisition of this major banking aggregation player in France, a long-time partner of the Crédit Agricole Group, is an important part of our strategic aim of offering customers of the Group’s banks innovative payment services that meet the highest market standards.

The gone Tuesday morning marked the launch of a sentiment-based portfolio named “The TIE-LongOnly CopyPortfolio.” The highly anticipated instrument is helmed by a strategic partnership between the eToro exchange platform and data analytics firm, The TIE. The product went live on eToro’s trading network with a minimum buy-in capacity of $2,000.

As per the official news about the new portfolio, it will take advantage of the excellence of Artificial Intelligence tools to scrutinize the Twitter platform for the latest positive or negative inputs concerning the digital assets. Interestingly, The TIE firm claims that it has access to a whopping number of daily tweets, amounting to nearly 850 million via its partnership with Social Market Analytics.

The portfolio algorithms will deal with 13 different coins: BTC, ETH, XRP, IOTA, BCH, NEO, ETC, DASH, EOS, XLM, LTC, ZEC, and ADA. The platform aims to assess the genuineness of the tweet content using machine learning and routine language processing pedagogy. It also checks whether it is about digital currency or not. Post this assessment; the solution will gear up for the real sentiment-crunching where a tweet sentiment will be compared against another tweet sentiment and not with other coins. The algorithmic rebalancing is done monthly.

Joshua Frank, the notable CEO of The TIE, stated that

We found that crypto is an asset class that is void of valuation metrics. With crypto, the only thing that really moves it is supply and demand, so we set out to develop sophisticated solutions for hedge funds to help value and trade the asset class.

The portfolio included five different crypto assets at the time of its first unveiling. These assets included stakes in varied proportions described below:

  • 24% DASH
  • 92% EOS
  • 86% XRP
  • 01% MIOTA
  • 97% ETC

According to Frank, Twitter serves as an unprecedented source for tracking crypto market movements. He called the social networking platform as “kind of the epicenter of the crypto universe.” The spearhead also stated that “Crypto remains an asset class driven by the wisdom of the crowd.”

The new portfolio is the practical application of eToro’s primary objective to aid retail investors to stand strong in competition with mutual funds and professional entities ruling the crypto domain.

The end result is that retail investors will have the chance to invest using a strategy that was previously only available to hedge funds,

said Guy Hirsh, who works as the U.S Managing Director of eToro. He also clarified that

We hope that this will give people on the fence about crypto a path to enter this asset class, as opposed to trying to figure out for themselves when to sell and when to buy.

Utpal Dholakia, the chief marketing head at Rice University, stated that the employment of tools for analysis of Twitter tweets about crypto would lubricate the process of price rise for the traders.

“Crypto are niche markets, they are made up of a specialized group of investors and participants,” said Mr. Dholakia. He also stated that

There tends to be a lot of social influence in the buying behaviors. Potential investors often tend to look for other investors’ behaviors to decide if they should buy a particular cryptocurrency.

U.S. equity reports remained mixed on Thursday as European shares dipped and investors turned their attention to economic data and company earnings from monetary policy. As U.S. productivity gains went up, treasuries experienced a slip.

Futures for the S&P 500 and Nasdaq 100 gained as the futures for Dow Jones Industrial Average remained stable. Caterpillar posted its first-quarter profit which beat estimates. Tesla shares went up during early trading as the electric car manufacturer geared up to raise over $2 billion through common stock and offerings of debt.

The Stoxx Europe went down as most of the national benchmarks in the region reopened after a holiday. Shell, the oil giant, beat estimates while Lloyd Bank slipped.

A majority of the European government bonds went up after data hinted at an extension of the slump in the euro area’s manufacturing sector. The pound fluctuated slightly as the Bank of England kept interested rates steady and hinted at hikes in the future.

In the other part of the world, trading remained low in China and Japan as the holiday week continued. Equity benchmarks in Hong Kong and South Korea hit high during the session after CNBC announced the possibility of a U.S- China deal being finalized by Friday.

Currently, markets seem to be holding steady after the Federal Reserve decision and press conference, which led to marginal gains for the dollar and stock decline. This indicated that some investors had expected a more dovish move from Jerome Powell and his colleagues.

On Thursday, data indicated productivity gains in the U.S. This was caused by the positive first quarter results. Economists and analysts await the monthly jobs report on Friday to get a better idea about the health of the United States economy. Economists have predicted a 3.8 unemployment rate with average hourly earnings going up by 3.3 percent.

The Stoxx Europe 600 Index went down by 0.4 percent by 8:38 am (New York time). This is the lowest it has gone down in the past two weeks.

Futures on the S&P Index went up by 0.1 percent. The U.K.’s FTSE 100 Index went down by 0.2 to reach the lowest point in the past month. The MSCI Emerging Market Index also went down by 0.05 percent.

The Bloomberg Dollar Spot Index went up by 0.1 percent as the euro went up by less than 0.05 percent.

The British pound dropped to $1.3041 by 0.1 percent, which is the first retreat in the last week.

The Japanese yen dropped to 111.52 per dollar by 0.1 percent. It is the biggest fall in the last week.

 

The popular Modern Monetary Theory supported by progressives has been called a crackpot idea by Jeffrey Gundlach, Chief Executive at DoubleLine Capital. Gundlach oversees over $123 billion and is also referred to as Wall Street’s Bond King. On a webcast program on Wednesday, Gundlach said that the Modern Monetary Theory is a way to justify a large socialist program and that it is complete nonsense.

Modern Monetary Theory supporters argue that government spending, and if required, deficits need to be used to meet the inflation and full employment mandates that are at present the U.S. Federal Reserve’s job. They believe that taxes are not required to support the spending as the government has that ability to create more money.

The Modern Monetary Theory has gained traction among several economists as well as Democratic Party politicians. However, it has also met with heavy criticism.

Stephanie Kelton, an economics professor at the State University of New York, is a leading supporter of the Modern Monetary Theory. She also advised U.S. Senator Bernie Sanders during his run for the Democratic presidential nomination in 2016.

During the webcast, Gundlach mentioned that the Modern Monetary theory is a ridiculous method to monetize debt and will cause a boycott of long term bonds. In case the United States enters a recession next year, before the next presidential election, there is a high chance the ideas could gain momentum.

With the liberals asking for a raise in taxes on the rich and an increase in spending more in order to encourage economic equality, many voters have been struck by populist discontent in the United States.

The emergence of the college bribery scandal has reinforced the populist narrative according to Gundlach. Dozens of people were arrested on Tuesday for their part in the $25 million scheme to help rich Americans get their kids into elite universities like Stanford and Yale. Several leading celebrities like Lori Loughlin and Felicity Huffman have also been charged with taking part in the scheme.

According to Gundlach, the recent college bribery scandal has brought down the reputation of the world of finance with people trying to turn the table in their favor.  He also said that the scandal helps the Elizabeth Warren crowd.

When talking about the run-up in the U.S. stock market, Gundlach mentioned that he considers the stocks to be in a bear market. He also predicted the stocks to go negative again in 2019.

Investors have had a tough time this year as the global markets have been volatile due to challenges in the world economy which includes the slowdown in China, trade tussle of US with China and Europe, Brexit, etc. The coming few weeks will bring more clarity on at least some of the economic situations if not all. Let us look at how the economies around the world will be affected this week after the cut in forecasts for global economic growth by the Organization for Economic Cooperation.

US and Canada:

  • Canada central bank deputy chief speaks about the health of the Canadian economy on Thursday.
  • Trade Representative Robert Lighthizer to testify on Tuesday on trade news between China.
  • Data on retail sales to be published this week.
  • Sales in retail likely to rebound while consumer growth is likely to remain at 1.6%.

Asia:

Report of Chinese Retail sales to be announced on Thursday and is expected to be around 8% noting a fall from the previous year sale of 9%. Industrial production is also expected to be reduced when compared to last year.

Governor Haruhiko, chief of Bank of Japan will address a gathering after deciding on its monetary policy. However, not many changes are expected.

The National People’s Congress will release the industrial production, credit, sales and investment data which will reveal to the investors how the world’s second-largest economy is performing after the stimulus Beijing has provided.

Europe:

As per economists, industrial production is set to fall by 0.9%, with a growth rate of 0.5%. Tuesday is an important day for England as UK Prime Minister Theresa May’s Brexit deal will get voted after which the budget session will commence with Chancellor Philip Hammond delivering the budget. After the stimulus announced by the ECB, it is time to see how Germany and the Euro region have done this quarter as they announce industrial production data for the first quarter which is an indication of the current health of the economy in that region.

Americas:

This week is an important week for the Americas too as most of the countries are going to release data regarding inflation. On Wednesday, industrial production data will be released after the current President assumed power. Argentina’s inflation figures for this month will be published on Thursday. Brazil’s new Reserve Bank Chief will start office on Wednesday. The IMF is all set to announce a multi-billion dollar loan to cash-strapped Ecuador.

The Prime Minister of Finland, Juha Sipila has officially offered the resignation of his government to the President on Friday, and it has been accepted by the president, the president’s office stated.

Meanwhile, the President of Finland, Sauli Niinisto has requested the government to work further as a transition Cabinet until a new administration is nominated. The legislative elections of Finland are to be held on 14 April.

The reason for submitting the resignation by the Prime Minister is because the Finland government failed to push the healthcare reform system, head of Sipila’s Centre Party which is a parliamentary group mentioned.

Antti Kaikknen posted on twitter saying, “Prime Minister Sipila will offer his resignation because he could not pass the healthcare reform under the regime of his government.”

While addressing a press conference, Sipila mentioned, “The healthcare reform was the main objective of his government, and he has been greatly disappointed by it.” Submitting his resignation to the President has been his own personal decision.

From 2015 onwards, Sipila has run the coalition government which was formed by his Centre party, Blue reform and conservative National Coalition.

Before becoming the Prime Minister of Finland in 2015, he was a businessman who had earned millions working as an IT entrepreneur and during his tenure had made health and social reform as the top priority of his government in the office. The healthcare and social reforms were very difficult, and they were struggling over it from decades and had also separated successive governments.

The main goal of the healthcare and social reform was to reduce the cost of treating aging people of Finland which is growing rapidly. The government mentioned that the reform could maintain the annual growth of social and healthcare cost to 0.9 percent from 2019 to 2029 instead of 2.4 percent which was predicted. Sipila had earlier said that, if the government fails to push the reform then he would resign from his post.

The decision of Sipila looks to be a strategic move which will allow his Centre Party a free hand during the election.

The resignation of his government is quite surprising, according to Pasi Kuoppamaki, the chief economist at Danske Bank. Now coalition partners will be able to completely focus on elections campaigns without working closely. This will have no impact on the economy of Finland.

Sipila’s decision also indicates that the government was unable to collect the needed support to pass the healthcare reform with the help of parliament.

Philadelphia Energy Solutions Inc (PES) is the owner of the oldest and largest refinery on the U.S. East Coast. It is a facing a financial crisis only a few months after it emerged from a controversial bankruptcy.

PES exited the bankruptcy in August experienced its cash balance fall to $87.7 million last year, down from $148 million just three months earlier. The $61 million declines were reported in its post-bankruptcy financial report which was filed in last January. PES entered bankruptcy about a year ago with $43 million cash on hand, according to court documents.  The cost of shipping crude oil from Canada or West Texas has caused refineries on the East Coast to suffer from difficult economies. However, Philadelphia Energy Solutions also had other additional problems at its plant in South Philadelphia, which included high debt costs and weak gasoline margins.

Philadelphia Energy Solutions filed for bankruptcy in January 2018 and blamed the costs of complying with the 2005 law that states that refiners have to blend biofuels into fuels or purchase credits from competitors who do.  Unfortunately, Philadelphia Energy Solutions does not have the required blending capabilities and has to pay for credits. According to a Reuters analysis, other factors like withdrawal of over $590 million as dividend style payments from PES by the investor-owners also caused the company to file for bankruptcy.

After Philadelphia Energy Solutions filed for bankruptcy, the company was offered a waiver of $305 million in liabilities in relation to biofuel credits as per the U.S. Environmental Protection Agency.  Poor gasoline margin also hurt the company’s bottom line. Philadelphia Energy Solutions’ weak cash positions also forced the refinery to scale back a $90 million maintenance project significantly.

Christina Simeone, director of Kleinman Center for Energy Policy, is not surprised that Philadelphia Energy Solutions is economically struggling again, although she did not expect it to occur this soon.  In the last three months of last year, Philadelphia Energy Solutions experienced a fall in its cash balance by $61 million. Someone also stated that Philadelphia Energy Solutions has been having financial difficulties since RIN prices went down 75 percent.  The Philadelphia Energy Solutions spokeswoman, Cheric Corley declined to comment.

Most U.S. East Coast refiners like Philadelphia Energy Solutions do not have access to cheaper crude which other refiners in different parts of the country have access to. This inflicts greater pain on the refiners in the East Coast region when margins are low.  Delta Air Lines’ refinery located near Trainer in Pennsylvania lost over $40 million in the last quarter. The company is thinking about selling the plant.

In the on-going World Government Summit in Dubai, DP world, one of the largest port operators, said it is planning to launch its first Hyperloop project in India.

In 2018, DP World, UAE’s state-owned port operator, signed a partnership with Virgin Hyperloop One to develop a cargo transporter. Now it has revealed its first project proposal with a destination of the world’s largest democracy.

DP World’s Chairman Sultan Ahmed bin Sulayem told at the World Government Summit in Dubai, “the first project will be in India, we signed an agreement, and we are looking at how to test the project.”

Sulayem added that the company is “eager now today to go on the next step, we are investing in something we believe is going to add value.”

The chairman continued, “We believe there is a need for it in India, one of the big problems in India is transportation, the congestion.”

He also described the importance of Hyperloop project as the technology has the potential to provide a transformative solution for the country of 1.3 billion as it runs underground, out of public view.

Virgin Hyperloop One is one of the few leading tech companies which aim to develop the technology that is hoped will revolutionize the transportation of people and goods.

It should be noted here that the technology was first envisioned by Tesla founder Elon Musk in 2013. The technology promises to be faster than air travel but at a fraction of the cost. The concept proposes to propel pods through a large tube underground at speeds of 750 mph using magnets.

When asked about the timeline to start the project, bin Sulayem declined to offer a date but said the date of the announcement would come soon.

He said, “We have a team in India that is working very hard, we’re working with our office here and in Los Angeles, but we are not wasting our time. The technology we brought into the company has improved 10 times. Whenever I meet with them, I see something new.”

It should be reported here that DP World is among the top four largest port operators on the planet by cargo tonnage.

The Bitcoin and Ethereum have slightly recovered resulting in the valuation of the crypto market increasing by $3 billion to $114 billion. Since January 29, the Bitcoin and Ethereum have both rebounded by 3 percent. However, they continue to remain volatile in a tight price range.

‘Moon Overlord’ a trader with an online alias, after taking into consideration the past performance of major cryptocurrencies, suggests that the block reward halving of Bitcoin, Litecoin and Ethereum. This could allow the three digital assets to recover in the mid-term strongly.

Analysts believe that only 1 percent of users could ever have more than 0.28 BTC, given that the supply of Bitcoin is fixed.

“If you own 0.28 BTC and HODL, you can be certain no more than 1% of the current world’s population can ever own more BTC than you. A modest investment of $1,830 today can ensure you are a 1%er in a future Bitcoin world,” said Steve Lee, a former Google Product Director.

It is believed that investors had already anticipated the halving years before it actually happened. However, a trader has stated that a bullish momentum could be created in the crypto market with the halving of Bitcoin and Litecoin’s block reward as well as the decrease of Ethereum’s block reward by 33 percent.

The trader mentioned, “LTC is halving in August of this year ETH is reducing its block reward by 33% in February BTC is having in a little over a year Block reward reductions and halvings are the most bullish events in crypto history, it’s time to pay attention and start accumulating.”

https://twitter.com/MoonOverlord/status/1088166671234334722

The rate in which miners mine new BTC will decrease given that the Bitcoin is expected to see its block reward decline by 50 percent by May 2020.

Because of the block reward halving, it is likely that the supply of BTC will be limited. However, the price trend could be impacted in case the demand for BTC continues to remain the same or increases.

Commenting on the supply of Bitcoin already being priced in, Chainalysis senior economist Kim Grauer said in November 2017, “That is a very complex question. On the one hand, direct calculations about market cap do not consider lost coins. Considering how highly speculative this field is, those market cap calculations may make it into economic models of the market that impact spending activity,”

For many investors who consider cryptocurrencies as long term investments, it is believed that the block reward halving is a positive catalyst that could boost the market.

Some traders expect that the halving might have an impact on the price of BTC by mid-2019.

Most major crypto assets and small market cap token have performed very poorly in comparison to both BTC and USD in the past three months, Binance Coin and TRON being exceptions. It is the right time to invest in it. You can buy Bitcoin and other cryptocurrencies from one of the best auto trading platforms – Bitcoin Trader.  Find more information and review on the official website.