Japanese Yen Reducing Sharply V.S. The Greenback On Thursday

The yen depreciated sharply vis-à-vis the U.S. dollar on Thursday as the greenback tested offers around the ¥93.15 level and was supported around the ¥91.90 level.

The pair gained 2.63% in 2009. In the absence of major news overnight, traders continue to square their books at year-end and react positively to dollar-supportive U.S. economic data.

Ongoing doubts concerning Japan Airlines and the company’s possible bankruptcy are having a negative impact on the yen.

Standard & Poors yesterday warned Japan’s “AA” credit rating could be lowered if Japan fails to stabilize its debt levels.

The Japanese government released a long-term strategy yesterday that aims to achieve GDP growth of an average 2% over the next decade.

Why Choose Foreign Exchange Trading Over Stocks Trading

Foreign Exchange trading holds significant differences to stocks trading. Understanding these differences will aid a trader in deciding the right market to enter. Fx trading itself has several advantages over stocks trading and is ideal for the beginner and individual small investors.

1. Low Transaction Costs for Forex Trading.

There are no hidden fees for forex brokers as they are not paid by the traditional commission based fees. The fee paid to the foreign exchange broker is calculated directly from the trade in the form of the bid ask spread. In forex trading, the spread is the difference in how much you pay for a currency and how much you sell it for. This spread is commonly expressed in "pips" or points.

2. Forex Trading is a 24 Hour Market.

Foreign exchange trading can be done anytime of the day, the forex market is open for business twenty-four hours a day. This is considered a huge advantage for individual small investors who are just starting out forex trading in their spare time. This allows foreign exchange traders to juggle their schedule around their trading opportunities; they can schedule their forex trading when it is convenient for them.

3. Fast Trade Execution and High Liquidity in foreign exchange Trading

Trading forex means that you are trading in cash. No other form of investment has more liquidity than cash and as such, trades are executed almost instantly. There is no lag time in foreign exchange trading.

4. Having Leverage and Margin in Forex Trading

One of the significant advantages that fx traders have is the ability to trade on margin. This gives them a huge leverage in their trading and presents the potential for extraordinary profits with relative small investments.

Sterling/ Greenback Gained 10.71% in 2009

The STERLING appreciated vis-à-vis the Greenback today as cable tested offers around the US$ 1.6235 level and was supported around the $1.6050 level.

Former MPC member and current CBI chief Lambert warned election politics could jeopardize the U.K.’s economic recovery. Cable gained 10.71% in 2009.

A Bank of England survey released this week reported banks were more willing to lend to homeowners and Firms in Q4 2009.

The quarterly credit conditions survey also indicated the availability of mortgage loans is expected to rise in Q1 2010 also.

Data released in the U.K. this saw Nationwide December housing prices rise 0.4% m/m and 5.9% y/y.

Prime Minister Brown talked up the U.K.’s economic growth prospects yesterday but acknowledged the economic recovery remains “fragile.” Brown must call a general election by early June.

Large spending cuts will likely be required to improve the U.K.’s fiscal position.