Monthly Archives: March 2008

“Groundhog Day” in the Financial Markets

I don’t know about
you, but I feel like I’m trapped in a real life version of the movie
I “Groundhog Day.” That’s the hilarious early-1990s comedy where Bill
Murray’s character travels to Punxsutawney, Pennsylvania to cover the
February holiday. Unfortunately, he gets stuck there, and has to
re-live that day — over and over again.

Just look at what
happened this week: There was yet another move from the Federal Reserve
to save the markets — this time in the form of a 75-basis point cut in
interest rates. That sparked more bottom-calling from many of the
talking heads on TV. And it fueled another 400+ point rally in the Dow.

I don’t mean to sound cavalier, but has anything really changed? Isn’t this the same movie we’ve seen four or five times since last summer?

First, the credit markets seize up in some way, shape, or form.

Second, stocks start falling.

Third,
the Fed, the Treasury Department, or Congress steps in and announces
another plan to fix the housing and mortgage crisis, or to loosen up
the credit markets.

Those interventions keep preventing the stock market from experiencing a big “flush” — a truly nasty decline that cleans out all the sellers and potentially sets us up for a larger, more lasting rally.

Instead, each new
plan helps spur some buying. We spend a few days or weeks working off
“oversold” market conditions. Then we go right back to square one
again.

This
one-step-forward and two-steps-back momentum looks exactly like what we
saw during the 2000-2002 bear market. And so far, there doesn’t seem to
be much lasting evidence of a reversal.

The Latest on Residential and
Commercial Real Estate

Wall Street’s
largest banks weren’t the only ones treated to a gift this week. The
regulatory body that oversees Fannie Mae and Freddie Mac also loosened
capital requirements for the two firms.

The Office of
Federal Housing Enterprise Oversight will now require they hold surplus
capital of just 20%, down from 30%. It also suggested that threshold
will fall with time.

The goal is to free
up money that Fannie and Freddie can use to buy or guarantee billions
more dollars worth of home mortgages. That, in turn, is designed to
lower the spread between rates on mortgage-backed bonds and U.S.
Treasuries — something that would lower the rates borrowers pay on home
loans.

It’s not such a bad
idea for the mortgage market, as ideas go. But home prices continue to
fall, and housing inventories remain extremely high.

Is there any evidence of a turn yet? Not as far as I can see. Just consider …

  • The
    National Association of Home Builders, which tracks how builders
    perceive sales activity and buyer traffic, said its benchmark index
    remains mired in the muck. The index held at 20 in March, just off its
    record low of 18 in December and far below the year-ago level of 36. 
  • Meanwhile, single-family home starts dropped another 6.7% in February to 707,000 units at an annualized rate. That’s the lowest since January 1991.
  • Building
    permit issuance for both single-family and multi-family property
    dropped to the lowest since 1991. That indicates future construction
    activity will be even weaker.

And what about commercial real estate? There is troubling news trickling out of thatside of the market as well.

Author: Mike –  Money and Markets

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Recommended FX Trading Learning and Study Materials

Recommended Tradining Materials from the Online Trading Academy

Home Study Videos and E-Books

Professional Trader Plus DVD Library Part 1 Online Trading Academy is delighted to announce that the first 3-day section of the famous on-location 7 day trading fundamentals course is now being released. Section 1 of the Professional Traders Series is 16 DVDs containing 24 hours of pro trader education.

Professional Trader Plus DVD Library Part 2 Online Trading Academy is delighted to announce that the second part of the famous on-location 7 day trading fundamentals course. Section 1 of the Professional Traders Series is 16 DVDs containing 24 hours of pro trader education. This second, continuation of the course is approximately 28 hours over the last 4 days in 16 DVD’s.

Introduction to Day Trading Video This award-winning interactive CD allows you to learn trading at your own pace, starting from the ground up. Interactive quizzes at the end of each section allow to test your knowledge and determine what you need to focus on.

E-Book: Electronic Trading Guide for NASDAQ, Level 2 A manual to teach investors how to electronic trade the NASDAQ using the now popular Level 2 screen. This manual is designed to get right down to business and is followed closely in our Professional Trader courses.

Home Study Value Packs

The Ultimate Professional Trader Plus CD Library Receive over 38+ hours (24 CD’s) of our highest quality trading education in one package! Order all of our trading education CDs at an astonishingly low price! Get the education you need to increase your trading profits!

Professional Trader Value Pack for Direct Access Stock Traders Receive over 30 hours (16 CD’s) of our best direct access trading education in one package! Our new trading value pack focuses on the core aspects of direct access stock trading. A great place to start your trading education!

Professional Trader Education Value Pack for Emini Traders Receive 15 hours (9 CD’s) of high intensity Emini trading education in one package! From core trading techniques applicable to all types of trading, to Emini-specific training, this 15 hour value pack has what you need to learn Emini trading at it’s best.

Professional Trader Education Value Pack for Forex Traders Receive over 15 hours (8 CD’s) of our best Forex trading education in one package! Containing the newest Advanced Forex CD, this education pack focuses on exactly what you need to know to become a successful Forex Trader.

Professional Trader Education Value Pack for Options Traders Receive over 16 hours (9 CD’s) of our best Options trading education in one package! From our beginner to our more advanced courses, this package will work synergistically to increase your trading knowledge and propel you to trading success.

Trading on Target Home Study Course Developed over a 14 year period by an expert Trader’s Coach, this program gives step-by-step solutions to problems that traders have with discipline. Includes CD’s, Videos, Audio Tapes, Workbooks and Hardcover Books.

The Complete Trading Education Package Completely revolutionize your trading education with this combination of The Professional Trader CD Library (24 CD’s / 38+ Hours) AND the Trading on Target Home Study Course! (Includes CD’s, Videos, Audio Tapes, Workbooks and Hardcover Books.)

Professional Trader Plus DVD Library Part 1 Online Trading Academy is delighted to announce that the first 3-day section of the famous on-location 7 day trading fundamentals course is now being released. Section 1 of the Professional Traders Series is 16 DVDs containing 24 hours of pro trader education.

Professional Trader Plus DVD Library Part 2 Online Trading Academy is delighted to announce that the second part of the famous on-location 7 day trading fundamentals course. Section 1 of the Professional Traders Series is 16 DVDs containing 24 hours of pro trader education. This second, continuation of the course is approximately 28 hours over the last 4 days in 16 DVD’s.

EMini Trading Home Study Courses

Professional Trader Education Value Pack for Emini Traders Receive 15 hours (9 CD’s) of high intensity Emini trading education in one package! From core trading techniques applicable to all types of trading, to Emini-specific training, this 15 hour value pack has what you need to learn Emini trading at it’s best.

E-Mini CD 1 – E-Mini Derivative Futures Get more bang for your buck through the leverage of E-minis! Mike McMahon takes you through the ins and outs of trading this highly liquid financial instrument.

E-Mini CD 2 – E-Mini Derivative Futures Once you understand the “mechanics” of the E-Mini’s, you are now ready to step up to the actual trade plans and begin making REAL money! Use these advanced strategies to leapfrog you to the next level!

Technical Analysis for the Professional Trader CD (Part 1) This CD contains critical information to help you learn to use charts and technical indicators in a clear, simple and concise manner to improve your trade entries and exits.

Technical Analysis for the Professional Trader CD (Part 2) Further refine your ability to use S&R lines, trend lines, candlesticks, continuation patterns and more.

Technical Analysis for the Professional Trader CD (Part 3) Learn how to truly understand and use Indicators for what they were designed for.

Fibonacci CD – Use Mathematical Magic for Better Profits from Each Trade Learn how to use Fibonacci Retracement, Extension and Projection Analysis to maximize your profits and tightly control the losses.

Trading as a Business CD – Trader Tax Strategies Learn to keep your trading profits with this excellent new CD, co-produced by Online Trading Academy and Traders Accounting.

Stress Management CD – Turn Yourself into that Successful Trader That is Inside Learn how to reduce stress in your life as a trader – remain cool under pressure and take the profits as they come.

10 Laws of Risk Management CD This course will take you through the 10 basic laws of Risk Management that will solidify your success as a trader.

Forex Trading Home Study Courses

Professional Trader Education Value Pack for Forex Traders Receive over 15 hours (8 CD’s) of our best Forex trading education in one package! Containing the newest Advanced Forex CD, this education pack focuses on exactly what you need to know to become a successful Forex Trader.

Forex CD 1 – The Fantastic World of Forex Learn Forex Trading from a pro with this Brand New CD – by Mike Mc Mahon – pips, leverage, which currencies to trade – it’s all here!

Forex CD 2 – Advanced Forex Trading Strategies Learn the more advanced Forex Trading techniques from a pro with this Brand New CD – step-by-step instructions through high probability entries, exits and the necessary stops to give you maximum profitability and capital preservation.

Technical Analysis for the Professional Forex Trader CD (Part 1) Learn to use charts and technical indicators in a clear, simple and concise manner to improve your trade entries and exits.

Technical Analysis for the Professional Forex Trader CD (Part 2) Learn to use Support & Resistance in combination with proper Trend Line drawing to mark on the high probability Entry/Exit. You learn how to “Stay In” a trade as we explore continuation patterns and the use of Moving Averages.

Technical Analysis for the Professional Forex Trader CD (Part 3) Learn to use Technical Indicators for the trading of Forex. We will explore their proper use and evaluation and dispel many of the bad beliefs many have been given by the “guru’s”.

Technical Analysis for the Professional Trader CD (Part 1) This CD contains critical information to help you learn to use charts and technical indicators in a clear, simple and concise manner to improve your trade entries and exits.

Technical Analysis for the Professional Trader CD (Part 2) Further refine your ability to use S&R lines, trend lines, candlesticks, continuation patterns and more.

Technical Analysis for the Professional Trader CD (Part 3) Learn how to truly understand and use Indicators for what they were designed for.

Fibonacci CD – Use Mathematical Magic for Better Profits from Each Trade Learn how to use Fibonacci Retracement, Extension and Projection Analysis to maximize your profits and tightly control the losses.

Trading as a Business CD – Trader Tax Strategies Learn to keep your trading profits with this excellent new CD, co-produced by Online Trading Academy and Traders Accounting.

Stress Management CD – Turn Yourself into that Successful Trader That is Inside Learn how to reduce stress in your life as a trader – remain cool under pressure and take the profits as they come.

10 Laws of Risk Management CD This course will take you through the 10 basic laws of Risk Management that will solidify your success as a trader.

Options Trading Home Study Courses

Professional Trader Education Value Pack for Options Traders Receive over 16 hours (9 CD’s) of our best Options trading education in one package! From our beginner to our more advanced courses, this package will work synergistically to increase your trading knowledge and propel you to trading success.

Options CD 1 – Opting for Options Trading Get introduced to the flexible world of Options trading and how to use them to manage risk in your trading.

Options CD 2 – Understanding the Greeks Get the real story behind the “Greek” letters and how they affect options!

Options CD 3 – Mastering Options Volatility Volatility in Options Trading is singly the most important aspect when calculating a high probability profit. In other words, master this concept, and watch your trading account increase!

Technical Analysis for the Professional Trader CD (Part 1) This CD contains critical information to help you learn to use charts and technical indicators in a clear, simple and concise manner to improve your trade entries and exits.

Technical Analysis for the Professional Trader CD (Part 2) Further refine your ability to use S&R lines, trend lines, candlesticks, continuation patterns and more.

Technical Analysis for the Professional Trader CD (Part 3) Learn how to truly understand and use Indicators for what they were designed for.

Fibonacci CD – Use Mathematical Magic for Better Profits from Each Trade Learn how to use Fibonacci Retracement, Extension and Projection Analysis to maximize your profits and tightly control the losses.

Trading as a Business CD – Trader Tax Strategies Learn to keep your trading profits with this excellent new CD, co-produced by Online Trading Academy and Traders Accounting.

Stress Management CD – Turn Yourself into that Successful Trader That is Inside Learn how to reduce stress in your life as a trader – remain cool under pressure and take the profits as they come.

10 Laws of Risk Management CD This course will take you through the 10 basic laws of Risk Management that will solidify your success as a trader.

Stock Trading Home Study Courses

The Ultimate Professional Trader Plus CD Library Receive over 38+ hours (24 CD’s) of our highest quality trading education in one package! Order all of our trading education CDs at an astonishingly low price! Get the education you need to increase your trading profits!

Professional Trader Value Pack for Direct Access Stock Traders Receive over 30 hours (16 CD’s) of our best direct access trading education in one package! Our new trading value pack focuses on the core aspects of direct access stock trading. A great place to start your trading education!

Advantages of Direct Access Trading with NASDAQ Level II CD This CD is a must if you want to understand the New Tools of the Trade and the problems the common investor or Online Electronic Trader are faced with.

 

Fibonacci CD – Use Mathematical Magic for Better Profits from Each Trade Learn how to use Fibonacci Retracement, Extension and Projection Analysis to maximize your profits and tightly control the losses.

8 Key Times of the Market Day CD You will learn when to be in the market and when it is more profitable to stay out.

Technical Analysis for the Professional Trader CD (Part 1) This CD contains critical information to help you learn to use charts and technical indicators in a clear, simple and concise manner to improve your trade entries and exits.

Technical Analysis for the Professional Trader CD (Part 2) Further refine your ability to use S&R lines, trend lines, candlesticks, continuation patterns and more.

Technical Analysis for the Professional Trader CD (Part 3) Learn how to truly understand and use Indicators for what they were designed for.

Trading as a Business CD – Trader Tax Strategies Learn to keep your trading profits with this excellent new CD, co-produced by Online Trading Academy and Traders Accounting.

Stress Management CD – Turn Yourself into that Successful Trader That is Inside Learn how to reduce stress in your life as a trader – remain cool under pressure and take the profits as they come.

Learn To Think Differently CD – How to Profit from Market Trend Changes Profit with contrarian indicators by identifying market tops and bottoms.

Short Positions – How to Trade Profitably by Going Short Most traders go long quite often – but in a flat or bear market, knowing how to go short will spell the difference between success and failure!

10 Laws of Risk Management CD This course will take you through the 10 basic laws of Risk Management that will solidify your success as a trader.

6 Psychological Biases CD – Who are you really? One the biggest causes of trading failure is a lack of understanding of what drives each of us to act in certain ways. This course will help you explore why, what and how to overcome these “pitfalls of the mind”.

Mastering Nasdaq TotalView Data System CD (Part 1 & 2) Learn how the new cutting edge TotalView system can help you enhance your trading results.

Power Trading in Globalization 3.0 CD This excellent CD will show you a true perspective on the chaotic world of finance, debt bubbles and how to protect yourselves, loved ones and finances.

Broad Market Analysis With Fernando Gonzalez Adaptation is the name of the game in long term trading success. Join Fernando Gonzalez and Mike Mc Mahon in a key educational CD that will show you how to analyze the big picture of the market and how to continually adapt yourself and your trading to it.

Mind, Method and Market With Mike Mc Mahon Discover how to overcome personal characteristics and “hard-wire” successful responses in your trading. Controlling your emotions is a huge part of trading success!

Start Trading FX Financial Trading Center

We’re proud to be able to offer you access to some great financial training materials. We’ve been talking with the Online Trading Academy, who run free seminars and have great free resources.

They’ve set up some information for our readers here:

Spreadbetting in the News – FT article

The FT today (14 March 2008), had a supplement solely devoted to spreadbetting.

Sponsored by the key players in the UK at the moment from CMC, to GNI Touch, it highlights some good points.

Remember to always consider advertising articles as biased, but they still provide useful insights into what’s going on and what’s available.

Spreadbetting, CFDS, and Contracts for Difference. Here to stay in the UK.

US Dollar falls to record low

The US Dollar fell to record lows yesterday (13/3/2008), gold touched $1000.

What’s driving the move?

The global markets are volatile, and the gloom of recession is building. US sales figures confirmed that recession is happening there already, which coupled with the US housing / credit crisis makes the economic situation for the US look very weak to many people.

Key Level notes:

  • the USD tumbled against the Yen through Y100 (1st time since 1995)
  • Euro moved to a record high of $1.56

What next?

There are rescue plans being discussed in congress to put forward $300bn loans to help the mortgage crisis, as well as calls for reduced dividends from banks…

But where will the market go… who knows.. clearly people are worried by the volatility, but in those situations there are profits to be made for good traders.