The Forex Figures

Today we are going to talk about the basic things you need to know before you start hitting your platform to trade.

They're the BIG FIGURE, SPREAD, HIGH, LOW and the DEALING RATES. 

Below figure shows it all:

Currency Pair: NZDUSD or simply read as New Zealand Dollar vs US Dollar. The rate 0.69993 means it takes .69993 New Zealand Dollar to have 1 USD. Or .700018 means .700018 New Zealand Dollar to have 1USD.

Big Figure, Spread and Dealing Rates

So what's the big figure of the NZDUSD? The big figure is the stem of the dealing rates. The figure above shows two rates the .69993 and .70018 where the stems of each rate are .69 and .70

Why is there a gap in the given rates? Just like your favorite coffee the price in a supermarket (buying) is not the same as the price in the Sari-Sari Store (selling). Meaning if you buy something it is but natural to sell it higher to make money. Now, this gap is what we call spread. In our figure spread should be computed as:

Hence, below should be read as: 

Buying: 0.70018

Selling: 0.69993

Or in short it can be read as 99-01(font is intentionally meant to be bigger than the stems); the two rates given is now the dealing rates.

High and Low

High means the highest price NZDUSD reached in a given market trading day; while Low is the lowest price the currency reached in a given market trading day.

Always remember, the variance between your high and low matters a lot in any given day. On an average a certain currency, no matter how volatile can only move as much as 100-150 pips. If it hits the average daily pip variance it will either congest or retrace.

Learn more about congestions and retracements on our next sessions. Thank you for reading. If you want instant update to our new posts, please subscribe to this blog. ➡️➡️➡️

Forex Space Ride

It was a hell of a roller-coaster ride last night after FED announced it's IRD (Interest Rate Decision) unchanged at 0.25%.

Two hours after that, the RBNZ released its own IRD that remains unchanged at 2.75%

EURUSD crashes to two-month low, amid hawkish comments from FOMC.  The FED sent strong indications that a rate hike will be on the table in mid-December when it meets next after a break next month. The hawkish stance sent the euro tumbling against the dollar, as it fell below 1.09 for the firt time since early August.  EURUSD traded in a broad range between 1.0897 and 1.1095, before settling at 1.0924, down by 120pips on the session.  The euro has now closed lower against the dollar in five of the last seven sessions.

USDJPY slingshot took a dip at 119.99 and hit high of 121.24, weaker by 125pips.  After the RBNZ it settled back to 120 level while closing at 121.07.  Today market opened at 121.07 and is currently playing at 120.68

Among the currencies  NZDUSD also took a drop from .6744 to .6620, changed by 124 pips and heading towards .6500.  Further, the New Zealand dollar fell in early Asia today as the central bank held steady on rates as expected, but called for a weaker kiwi, while the dollar firmed on expectations for a Federal Reserve rate hike at the end of the year.

Despite the Reserve Bank of New Zealand's decision to hold the rates steady it jawboned the currency lower by stating that lower interest rates would be required if the exchange rate remains high.