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Government Bonds Rates by Moody’s and S&P and Fitch

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Bonds and stocks are all securities, the difference being stockholders or owners of a company while bondholders are deemed, lenders.

A government bond is a debt security issued by a government to support government spending and obligations. Bonds play a critical role in balancing portfolios and general economies. Investors are thus encouraged to take on bonds and stocks concurrently. Returns on bonds may be lower than stocks, but they are safer protected ways of investing in securities. The level of its duration can quantify the interest rate of bonds.

Moody’s Investors Service provides international financial research on bonds issued by commercial and government entities. Moody’s, along with Standard & Poor’s and Fitch Group, is considered one of the Big Three credit rating agencies.

See List of government bonds rated by Moody’s and S&P and Fitch : Government bonds

According to Moody’s, the purpose of its ratings is to “provide investors with a simple system of gradation by which future relative creditworthiness of securities may be gauged.” To each of its ratings from Aa through Caa, Moody’s appends numerical modifiers 1, 2, and 3; the lower the number, the higher-end the rating.

Fibonacci Retracement Levels 88.6%

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In theory, fib. Extreme retracement after 88.6 is not an important level. However, based on several case studies, the price oscillates around 88.6 to 100% Fib. Retracement very often before rejection or breakout moment.

88.6 Fib. the level represents the price level derived from the golden ratio (0.618 x 0.618=0.786, 0.786 x 0.786 = 0.886= 88.6%).  Fibonacci Retracement Levels 88.6% and 78.6% can be important levels in some cases, so traders need to monitor these levels and check there are price reactions in this area. The best practice is to draw Fib. Retracements levels and Fibonacci expansion levels and analyze all price levels during the trading.

88.6% price level is derived by squaring (or multiplying by itself) from the Golden Ratio, 0.618:

0.618 x 0.618 = 0.786 (78.6%)
0.786 x 0.786 = 0.886 (88.6%)
0.886 x 0.886 = 0.941 (94.1%)

Learn more, in detail articles Fibonacci expansion levels.

Tips for Using the Minimum 88.6% Retracement with Fibonacci Pattern in Forex Trading

When you seek the Fibonacci trading, there are 3 main patterns:
1. The usage of multiple setbacks and extensions for identifying price levels in different Fibonacci levels that overlap for producing “clusters.”
2. The use of multiple indicators like MACD in different Fibonacci levels.
3. The use of Fibonacci levels as a part in a larger graphic pattern, like in the “head and shoulders” pattern.
Fibonacci

Here, you would find information on a specific Fibonacci level focusing on trade and mostly in seclusion. It is a decline of 88.6%. This level was reached for summarization after using 0.618, the Golden Ratio, the square root, and the square to achieve 0886.

When it is exclaimed that it is achieved by making Fibonacci retracement, it means the retracement to 88.6% tells the range of the original characters. Therefore, if the starting step involved 100 pips up, retracing to 88.6, the grains will decline. The unique thing about Fibonacci levels is that they are not influenced by a specific time. They feature the same importance as wanted in a weekly long-term chart, or else they have a graphic instant five minutes.

The first price achieved high Point X 1.1967 on 8th March 2009. Then, it came down to .9909 on the Y-Point on 22nd November 2009. Therefore, the price came down to 2058 points in 37 weeks. The Z price point comes to 1.1730 on 30th May 2010, 28 weeks post Y point. When the figures and diagrams are examined, they were at 2 points, with the retracement level being 88.6%. This is unbelievable, as the price was up thousands of points for many weeks already, which is the precise matching with the main Fibonacci levels.

When this level is identified, you will find a spotless hit giving a trader over 1000 pips when the trader chooses to stay put once the price retracement ends Point-Z. This was accompanied by the long-term decline in USD / CHF, which can be experienced even today. Else, finding that an important Fibonacci level was clean and tested with success, an operator can make several trades in a short-span chart, even in 1 hour, seeking items for selling USD/CHF. Use a long-term plan while entering shorter-term time frames, keeping higher risk-reward ratios, and tight stop-loss in your trade.

One of the possible targets in your trades can be either the beginning of the retracement, expanding 100% of the starting movement, or Point Y, with the starting point being a little out of Point Y.

Swap Points and Its Importance in Forex Trading Strategies

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This article will write how to calculate swap points and their importance in forex trading strategies.
Swap Points and Its Value in Forex Trading Techniques

Fx Swap points or currency swap points are the difference between the spot rate and the forward rate in currency pairs indicated in pips. Normally this is carried out for a certain type of currency pair which you want to trade.

Within this, a financial concept called Interest Rate Parity is used to calculate the points. This concept reveals that after investing some money and after getting the returns for different foreign currencies, you have to compare with the interest rate without a doubt.

Forward dealers using this concept identifies swap points in Forex currency trading simply by considering the advantage or the net cost when borrowing and lending currency mathematically over a period of time covering the forward delivery and spot value date.

How to calculate swap points – a formula

Forward Prices, Swap Points in Forex Trading

To be able to calculate the based currency of forwarding rate with U.S dollar, the equation below can help you:

Spot Price x (1 + Ir Foreign) / (1+Ir US) = Forward Price

Where “Ir Foreign” means the rate of interest for counter currency, whereas “Ir US” indicates the rate of interest in the United States, using this equation, you can calculate the swap points; now you can get:

Forward Price – Spot Price =Swap Points

Spot Price x (1 + Ir Foreign) / (1+Ir US) – 1)

Rollover Swap in Currency Pairs

To understand the equation and how it works for rollover swaps, you have to carry out a practical example for calculating the fair value.
Being aware of Interbank’s deposit rates for each currency pair you want to deal with is extremely important. You have to know the predominant terms based on the time period of the Interbank. After learning the terms, you can compute the swap points for the currency pairs you want to deal with by creating the base currency with the U.S. dollar using the equation above.

By discovering the interest rate of the currency pairs, you can furthermore calculate the rollovers. Being aware of the rollover from the delivery date to the following day where you can carry on doing business in the foreseeable future is certainly one of the best examples of rollover swap.
You can also make and crank out money using the interest rate of currency pairs that you buy and keep them for a long time if the interest rate is 0.25% U.S. Dollar for a short period of time. Because the interest rate is 5% for the Australian Dollar for the short term, the currency held is short, and you have to pay the currency pair’s interest rate.

A variation in the interest rate of 4.25% of currency pair is annualized in the rollovers. And you adjust to the specific time frame by implementing the tomorrow/ next swap rollovers for 1 year if you aren’t trading with rollovers.
Keeping an overnight position for a short AUD/USD, there will be a variation in the interest rate of 4.25% annually divided by 360 for a dealer as a rollover fee. Plus for a rollover period of one day is represented by 30/360. And for a day rollover swap, it’s represented by tomorrow/ next rollovers.

By multiplying the transaction’s sum with the interest rate for tomorrow/ next period, you’ll get the rollover fee of currency pairs. And by converting the currency into AUD/USD to get a fair value price, retail brokers usually charge the rollover fee in pips.

Holding a long position to get the sum equal to the AUD/USD dealers would try to roll over for a long term deal. But because of the Forex broker agents’ downward offer, the amount received will be less. Find more answers read articles about “Usage of basis swaps for hedging.”

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Trader Slang – forex glossary slang

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What is the slang definition?

Slang is the term that denotes a set of particulars words and expressions that are unusual of non-official communications for some group of people in the society. The language of cultural societies, geographic places, and representatives of various professions had had its peculiarities that reflect the people’s views and, in fact, points out their status and society. Jargon or slang is different from the literary speech norms, but usually, most slangs make communication easier. Like other people, traders have their slang words because they also keep a good imagination and a sense of humor.

In the below mention list the detail of all the main terms of slangs is presented . Market traders in their non-formal communication usually use these slangs. This list of slangs will help the newcomer on the market for getting into the trading swiftly.

Bull market “bullish”: when the market is upward.

Bear market “bearish”: when the market is downward.

Margin call: When losses exceed margin, a margin call is given at that moment either you have to refill your account or reduce some open trades.

Tick, Item: It is a small step that brings a change in the prices.

Long (position): Whenever some traders buy something with an assumption of an increase in price in future time

Short (position): when traders sell something on the assumption of a price drop.

Heat: When they talk about the big risks in trades.

Range: Whenever the market is stagnant, it means no down or upward trend for a while.

Flat (Square): When traders sell all stocks.

Setup: a specific environment for trading.

Gap: It is a difference between the last period’s close price and the next period’s open price.
Whipsaw: It is a position of volatile markets, and in this condition, a movement in price is sharp followed by the same sharp reversal.

Rally: It is a recovery period after the decline in the market.

Profit (Gain): Earned money gained after selling stock.

Loss: Lost money after selling stock.

Pip (Point): The last digit, like, in Euro/USD one point=0. 0001.

Slippages: It is the execution of the order when the market is fast, but the broker has low liquidity, and due to this, he cannot execute your order.

Drawdown: It is in the Forex trading account value.

Squeeze: It is an action for raising the money price by any central bank.

Limit: When they place orders for buying or selling currencies at a particular price or more.

Lock: When you open 2 positions for one stock with one specification and size in diverse directions.

Majors: It means the most famous pairs of currencies are available to trade. Like AUD/USD, USD/CAD, USD/JPY, GBP/USD, and EUR/USD. On the contrary, ‘Exotics” are less traded pairs.
Cable: British Pound, GBP.
Aussie: Australian Dollar, AUD.
Swissie: Swiss Federation franc, CHF.
Kiwi: New Zealand dollar, NDZ
Loonie: Canadian Dollar, CAD.
Holy Grail: It is a consistently profitable trade system.

There is much more slang contently growing with the span of time, so it cannot be said that it is a complete list.

Spanish language – Hindi Language

Spanish language website Hindi language website