Factors Affecting Foreign Exchange (FOREX) Rates

When trade takes place between the residents of two countries, the two countries being a sovereign state have their own set of regulations and currency. The exporter would like to get the payment in the currency of his own country, the importer can pay only in the currency of the importers country. This creates a need for the conversion of the currency of importer's into that of the exporter's country. Foreign exchange is the mechanism by which the currency of one country is gets converted into the currency of another country. The conversion is done by banks and financial institutions, who deals with foreign exchange business.

When one currency is converted into another, there must be some basis in effecting the conversion. The basis by which the currency unit of one country gets converted into currency units of another country is known as foreign exchange rate. Foreign exchange rate is therefore the price of one currency in terms of another. The rate of exchange for a currency is known from the quotation in the foreign exchange market.

Factors Affecting Exchange Rates

Factors Affecting Foreign Exchange (FOREX) Rates

In the globalized economic environment of today, economic activity is globally unified to an unprecedented degree. Thus, changes in one nation's economy are rapidly transmitted to that nation's trading partners. These fluctuations in economic activity are reflected, almost immediately as fluctuations in currency values.

Some of the important factors that influence currency values are balance of payments, inflation rates and interest rates.

Balance of Payments: The balance of payments summarizes the flow of economic transactions between residents of a given country and the residents of other countries during a certain period of time. Balance of payments represents the demand and supply of foreign exchange which ultimately determine the value of the currency. When the balance of payments of a country is continuously deficit, it implies that the demand for the currency of the country is lesser than its supply. Therefore, its value in the market declines. If the balance of payments is surplus continuously, it shows that the demand for the currency in the exchange market is higher than its supply and therefore the currency gains value.

Relative Inflation Rates: Suppose that the supply of dollars increases relative to its demand. This excess growth in the money supply in an economy will cause inflation. This inflation causes the weakening of nations currency.

For example, higher prices in the United States will lead American consumers to substitute French imports for U.S. products, resulting in an increase in the demand for euros. In effect both French and Americans are searching for the best deals worldwide and will switch their purchases accordingly. Hence a higher rate of inflation in the United States than in France will simultaneously increase French exports to the United States and reduce U.S. exports to France. In other words a higher rate of inflation in the United States than in France will lead to depreciation of the depreciation of the dollar relative to the euro or, to an appreciation of the euro relative to the dollar. In general, a nation running a relatively high rate of inflation will find its currency declining in value relative to the currencies of countries with lower inflation rates.

Relative Interest rates: Interest rate differentials will also affect the equilibrium exchange rate. For example, a rise in US interest rates relative to Indian rates all else being equal, will cause investors in both nations to switch from Rupee to dollar-denominated securities to take advantage of the higher dollar rates. The net result will be depreciation of the Rupee in the absence of government intervention. It should be noted that the interest rates discussed here are real interest rates. The real interest rate equals the nominal or actual interest rate minus the rate of inflation. The distinction between nominal and real interest rates is critical in international finance. If the increase in U.S. rates relative to Indian rates just reflects higher U.S. inflation, the predicted result will be a weaker dollar. Only an increase in the real U.S. rate relative to the real Indian rate will result in an appreciating dollar.

Factors Affecting Foreign Exchange (FOREX) Rates
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Abey Francis, a full time blogger engaged in the areas of management and technology. Author and Moderator of famous business management blog Management Articles and Business Case Studies

Top 10 Hair Dying Mistakes

Whether you want to want to get rid of that gray hair or you just want to have a new look, dying is a good way to achieve it. Unfortunately, hair dying entails consequences that may damage and dry your hair when used inappropriately. The selected color of your dye should blend with the original color of your hair and eyebrows and to enhance your features. Experimenting is good, but dyes can be rough on your hair when used frequently. Although it is best to dye at a professional salon or stylist, it is much cheaper at home with the same creative effect. Before you see the top 10 hair dying mistakes, it is important to have an understanding of the different types of hair dye that are available so you can put them in context.

Types of Hair Dye

1. Permanent hair dye

Top 10 Hair Dying Mistakes

While dying your hair permanantly is, by some, considered in and of itself a mistake, the obvious benefit is that it lasts for a considerable time. As the hair grows, it is applied to the roots. It contains ammonia and peroxides, which can possibly cause dryness and damage. Exposure to the sun and salt water will cause the color to fade. That's why in order to maintain the color, it is best to cover your hair by using a hat or bandanna when going outside.

2. Long-lasting Semi-permanent

As the name implies, has the longest life remaining even after more than 20 washes, depending on the brand.

3. Semi-permanent

These have the shortest lifespan for dyes. After 6-12 washes, the color will start to fade. This is recommended for first-time users and those who want to experiment with colors.

How to dye your hair safely and professionally:

- Separate hair into two quadrants. Then clip each part.

- Wear plastic gloves while mixing dye solution. Follow the directions written on the box.

- Squeeze a small amount of coloring into one quadrant. Streak thin stripes of color over the whole area of the quadrant. Put a clip on the colored part.

- Repeat the process after you have completed coloring the four quadrants.

- Consult instructions on how long you should leave it. Add a couple of minutes of wait to that of the suggested treatment time.

- Put on left over color mix to the entire head after a few minutes.

- Rinse with cold water.

Top 10 hair dying mistakes!

- Number 10: Applying dye to dirty, tangled hair

Deep condition your hair a month before dying to maintain color. Be sure your hair is relatively clean before applying. Trim hair especially dry and split ends to even out color. Hair should be slightly damp when dye is applied.

- Number 9: Using hair conditioner before you dye

Do not condition your hair a few hours before applying hair dye, shampooing will do the trick. Your hair needs to be free of free radicals such as dirt and oil as much as possible.

- Number 8: Choosing hair dye based on what the model on the box looks like

Consult the local salon or stylist on what colors would look best on you. The hair dye you choose should have the same tone as your skin color.

- Number 7: Forgetting to check for allergic contents

After choosing a brand, apply a tiny amount of hair dye near your neck or behind your ear to see if irritation, redness, inflammation, allergy, hair loss or any bad reactions occur. Wash the affected area right away if this happens. Remember the instructions carefully. Do the patch test 1-2 days before hair dye application.

- Number 6: Doing your entire head without testing a small amount of your hair first

Do a strand test by applying a bit of dye to a few stands of your hair to see if you got the right color.

- Number 5: Staining your skin or clothes

Protect your skin by wrapping a towel around your neck as the dye can irritate your skin or affect your clothes. Gloves should be used and must be included in a hair dye kit. Applying petroleum jelly or cream around your ears and neck part will keep off stains. Wipe off oil after shampooing. If you do happen to stain your skin, don't worry, rubbing alcohol will remove dye stains from your skin

- Number 4: Picking a color that does not fit with your natural hair color

Pick a color one shade lighter when dying your roots. This will make the transition from your colored hair back to your natural hair color graceful without roots that are a completely different color sticking out. Obviously, this rule does not apply if you are dying your hair a completely different color than your natural hair color.

- Number 3: Losing hair

After dying, always rinse with cold or tepid water to avoid your own hair from falling out.

- Number 2: Over-dying hair

If you did not achieve the desired effect, using Liquid Tide can correct this. A couple of days of use will lighten the color until your hair returns to the original color. Instead of over-dying, do touch-ups every four to five weeks to keep your hair color picture perfect.

- Number 1: Dying eyebrows and eyelashes

Never use hair dye on eyebrows and eyelashes! Ask for medical help when dye gets into your eye.

Top 10 Hair Dying Mistakes
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For more great hair dye related articles and resources check out [http://haircolor.haircarehaven.com]

Forex Trading - Technical Analysis

Okay, I've pretty well covered Fundamental Trading (news events), so now it is time to get into the other common way of trading, and that is called Technical Trading. Most of this trading is done off the charts, hence the expression 'chartists' or 'technical analysis' etc. This is the way I trade, and it is the way of how a lot of others trade also.

Earlier I discussed how most Forex brokers offer a charting package with their platform, and how the live data was free. This is good as it keeps costs down. Some of these platforms have excellent charts, like the MT4 platform or even VT. This is where Oanda is a bit of a let down as their charting capabilities just don't compare. Having said that, you can still trade off Oanda charts no problems at all, they just haven't got all the bells and whistles.

Now with technical trading, you can be as simple or complex as you like. I am not going to go into all the various indicators, fibs, pivots, breakouts, trend lines etc. There are literally thousands of ways to trade and the internet is swamped by them, as are the more popular trading forums. So you can do your own research here and find something that suits you.

Forex Trading - Technical Analysis

But I will talk about time frames. As we already know, the Forex market runs 24hrs a day during the week, so there is plenty of opportunity to trade. Remember the previous discussion on the different sessions also, which helps with regards to identify when the action is more likely to occur.

On the trading platforms, most brokers offer 1 minute, 5 minute, 15 minute, 30 minute, 60 minute, 4 hour, daily, weekly and monthly charts. That's the majority of them. Some also offer tick, 10 minute, 2 hour and 3 hour charts. There was one platform, who's name escapes me, offered any time frame you desired, so if you wanted to trade off a 45 minute chart, it was possible. Remember all this data is live and it's free.

Every one wants to be a Day Trader! Me included. I think it is just a romantic notion that is built into the human make up. It is especially cool if someone asks you what you do for a living, and you reply "I'm a Day Trader". Sounds impressive. I wish it was that easy though.

Because the charts and the data are so good, you are always tempted to keep on shortening the time frame, where eventually you will be trying to scalp off the 1 minute charts. All sounds good in theory, but very difficult to do.

Look, I'm not saying it can't be done as I am sure there are a few successful scalpers out there. Not many I would imagine, but enough to show that it is possible. I have tried all time frames, and even though I have probably had most success on the longer time frames like 4 hours and above, I am still a Day Trader at heart.

Again, this is a decision you have to make, whether you want to be in a trade for days or minutes. Trading the longer time frames will obviously give you less trades, but more than likely larger profits, and spend more time monitoring than actually trading. Trading off the shorter time frames will give you more action, more spreads to make up, more than likely smaller profits. Then you would have considerations like stop size. Trading on a Daily chart may require you to have a stop 120 pips away from your entry price, and when you consider the 2% risk rule, you would end up with a much smaller position size. Now if you were trading off the 5 minute chart and had a 15 pip stop, and using the same 2% risk, you can see that your position size would be much larger. The trade off being the possible potential profit as I'd expect to drag a lot more pips from a Daily chart trade than a 5 minute chart trade. Bit of a catch 22 here.

Then you have to decide which pair or pairs you want to trade. If you are trading multiple pairs on the larger time frames, it is quite easy to do so. This may also help with giving you more action, if that is what you are after. But trading multiple pairs on the smaller time frames can be a little stressful and sometimes difficult to keep control of when things start moving quickly. It also plays with your mind a bit, especially if you have a losing trade on one pair and try to make up for it on another pair, which may cause you to ignore your normal exit rules. I think they call this revenge trading.

If you are going to trade off the smaller time frames, may I strongly suggest you concentrate on one pair to start with. This just makes life a lot easier and you can put all your efforts into this one pair.

My bread and butter set up, is just the EUR/USD on the 5 minute chart, with a 60 minute chart next to it, just to give me an idea of the general trend. I have a couple of basic indicators on both charts. I chose the EUR/USD for a couple of reasons. One it has the lowest spread on Oanda, dropping down as low as 0.9 pip during normal trading times, and two, it is by far the most popular currency pair traded. I think it accounts for close to 70% of total Forex volume. Don't quote me on that though! I have a target amount of pips for the day and then I am done. I close down my charts and do other stuff. I sleep better when I have no trades on.

The above is what I do, and what works for me. It may not work for you and I'm certainly not trying to convince anyone to follow my path. I'll discuss specifics on my trading at a later date. If you have had experience at trading anything, you will know that there are thousands of different ways to trade, and Forex is no different.

If you were after a pretty good book on Trading in general, then may I suggest a book called 'High Probability Trading' by Marcel Link. It covers all the major topics and is quite informative considering it is such a huge topic. He does a good job of covering a lot of it. Wouldn't be out of place in any good trading library. The other book I would suggest is 'Google' as it is the world's biggest library by far, but please remember a lot of it is rubbish. You have to sort out the good from the bad.

Just looking through my notes, and there is still plenty to discuss....

Forex Trading - Technical Analysis
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Article by Jim Brown

For my personal Forex Trading please visit http://www.accurateforextrader.com
If trading stocks and options is more your thing, then please visit http://www.accuratestocktrading.com

How to Identify Market Range and Trend - Trade Forex Successfully

A trend is defined as the general direction of price movements. An uptrend exists when prices continuously achieve higher highs, or as they're alternatively referred to as "Higher Tops" and higher lows (bottoms). A downtrend is present when prices slope downwards as a result of a series of lower highs and lower lows. The main objective of trend trading is to enter as close as possible to the formation of a new trend and stay with it until it breaks down.

A range is created when price continuously bounces for a period of time between an upper level and a lower level. Range trading takes place when price is trading in a sideways or horizontal channel that is capped by a ceiling or resistance and a floor or support.

Currency pairs tend to oscillate regularly between being range-bound or trending. With the former, traders usually adopt a simple "buy low, sell high" approach, whereas with the latter they attempt to trade with the trend. Detecting whether the market is range-bound or trending is not so easy and can be costly if determined incorrectly. One of the most popular methods of determining the state of the market is to use the Fibonacci Retracement levels.

How to Identify Market Range and Trend - Trade Forex Successfully

If price is in either an buying (ascending) or selling (descending) channel and then it begins to pull-back by a portion of its original move, then this is known as a Fibonacci Retracement. Quite often as it reverses direction, price eventually finds support (buying channel) or resistance (selling channel) at key Fibonacci levels before it continues in the original direction. These levels can be identified by drawing a line between lowest and highest points of the original movement and then dividing the vertical distance by the key Fibonacci ratios of 38.2%, 50%, 61.8%.

For example, consider a significant rally to the upside that then starts to reverse. If price then passes through all 3 commonly used Fibonacci levels i.e. 38.2%, 50%, & 61.8%, this is a very strong indication that a trend is not forming because support was not found as any of these levels.

This type of action is normally indicative that the buyers are not in control of the marketplace. This relatively equal distribution of power between the buying and selling forces produces increased chances that price will remain in a range-bound market environment until conditions alter.

In contrast, trends exist when there is an uneven distribution of buyers and sellers that forces the market to either new highs or lows. For instance, the market again rallies to the upside but this time finds a new resistance at the 50% Fibonacci level. This action indicates that the sellers have gained control of the marketplace and, as such, an ensuing downtrend is very probable.

As trend trading generates far more losing trades than winning ones, typically around 60% of the trades end at a loss, it requires rigorous risk control.

Most Money Management strategies recommend that traders should not risk more than 2.5% of their total capital account on any given trade. If traders do use high leverage, then they leave their accounts vulnerable. However, traders must mentally steel themselves to the fact that employing very tight stops can often result in 10 or even 20 consecutive stop-outs before they succeed in achieving a winning trade with strong momentum and directionality.

True range traders do not care about direction. The fundamental assumption about this type of trading is that price will always return to its original starting value no matter how far it travels. This is sometimes referred to as "mean reversion theory", which means price tend to revert to the mean, even after they had travelled a substantial distance up or down the chart.

For example, imagine that EURUSD is trading at 1.4000. Classic range traders may then opt to short the pair and then every 50 pips higher should the market move in the opposite direction to their preferred one. These traders will then plan to close their trades at a profit every time price moves 25 pips below the levels of activation. However, to perform this strategy successfully requires traders to have very deep pockets. One method around this problem is to use less leverage by utilizing mini or micro Forex accounts.

How to Identify Market Range and Trend - Trade Forex Successfully
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The Top 10 Cigarette Smoking Effects on the Body

All smokers are fully aware of the devastating effects that smoking has on the body. I was a smoker for 15 years, and this list is not designed to scare all the smokers out there, although it just might.

1. The smokers cough. If you have smoked for any length of time you will have the smokers cough. You may think this is an inconvenience if your a smoker, and most smokers try to hide it. This cough is actually your body trying to get rid of the poisonous fumes you are inhaling on a daily basis. It is the sound of your lungs expelling all the chemicals in tobacco smoke. This is a good thing for your body all though you may not think so.

2. Stained teeth. After smoking for so long I was well aware of my yellow stained teeth. I got into the habit of smiling with my mouth closed, a lot of smokers do this. Sure, you can go and get your teeth whitened these days, but sooner or later the stains will be back if you continue to smoke.

The Top 10 Cigarette Smoking Effects on the Body

3. Yellow fingers. This is basically the same problem as stained teeth. I used to rotate my finger when smoking so one would not get stained too much. If you smoke roll ups this problem will be even worse. No amount of scrubbing will get rid of it, the only solution is to stop using the same finger.

4. Shortness of breath. I always played a lot of sport even though I smoked. As the years went by I found I always started coughing after any kind of physical exercise. Your lung capacity is reduced by smoking. I found that I could not hold my breath for very long. One of the worst experiences I had was during a physical test for work. You know the kind I mean, when you have to blow into a meter to test lung capacity, and you just know that your attempt will be well below average. You then get a read out that tells you that you have the lungs of a 50 year old, and your only 35.

5. Circulation problems. Smoking blocks arteries and reduces blood flow. I always seemed to feel the cold, especially in my feet. If I got into a hot bath when my feet were cold it caused a lot of pain. Smoking can also lead to varicose veins and impotence.

6. Grey complexion. You can tell a heavy smoker from the way their skin looks. They look grey and paler than non smokers. Smoking makes your skin age quicker. You may not think this is a problem when you are young, but you will see the effects of cigarette smoking when you get older. You are starving your skin of essential nutrients.

7. Lack of energy. I always thought I did not suffer from this problem. At the age of 36 I was a keen sportsman and ran regularly, I liked to keep fit. Sounds a bit stupid doesn't it, I mean I smoked 20 cigarettes a day and I sort of blanked my mind from what I was doing to my body by smoking. It was only when I stopped smoking that I found I had so much more energy. I would wake up in the morning feeling completely awake, when I smoked I had to drag myself out of bed. I also found I could run further and faster. The reason is that when you smoke you are starving your body of oxygen, and this leads to a lack of energy.

8. Dry mouth. I used to wake up in the morning with a mouth that felt like sandpaper. I wondered how my tongue could be so dry. You just get used to this effect, and it gets worse the longer you smoke. It makes your breath smell and you don't even care.

9. Taste and smell. When you smoke you gradually lose the ability to smell things properly and your taste buds don't work like they used to. When I stopped smoking I found these two senses returned very quickly, making meals much tastier. You will smell of tobacco smoke if you smoke, but you can't tell. Just try smelling your clothes after a night out in the company of smokers when you don't smoke. This is what you smell like all the time.

10. Dizzy spells. If I got out of the bath too quickly I would get funny bright lights in my head. It was a strange sensation, and it affects some smokers more than others. Most people will get dizzy spells if they sit upright quickly, but a smoker will feel more dizzy because they have less oxygen in their bodies.

This list does not include the most common cigarette smoking effects on the body such as lung cancer, heart disease and the many others. These are added bonuses you can expect if you smoke. Most smokers don't think they will contract these diseases. I just blanked my mind to them when I smoked. The reality is that 1 in 2 smokers will die from their addiction if they continue to smoke.

The Top 10 Cigarette Smoking Effects on the Body
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If you are a smoker and you are suffering from these side effects the only way to get rid of them is to stop smoking. I found the process of stopping smoking enjoyable, yep you heard that right. You too can stop smoking and find it not only easy, but enjoyable.