Volatility (fluctuation) is a statistical financial indicator, featuring price’s fluctuations. It is an important financial indicator and a notion in the financial risks management, where it acts as a risk level of the financial instrument’s use for a given period of time. To calculate the volatility, one uses a statistical indicator of the sample standard deviation, which enables investors to determine the risk of acquiring the financial instrument. Most often, one calculates the average annual volatility. Volatility is expressed in absolute ($100 ± $5) or relative value from the initial price (100% ± 5%). There are two types of volatility:
Historical volatility — is a value, equal to the standard deviation of the financial instrument’s value for a given period of time, calculated on the basis of historical data on its value.
Expected volatility — volatility, calculated on the basis of the current value of a financial instrument under the assumption that the market value of a financial instrument reflects the expected risks.
In the period from May 14th until May 18th, the main events that may have a significant impact on the Dollar’s quotes, will be the data on the consumer price inflation (May 15th), as well as the last meeting’s protocols of the Federal Open Market Committee of the Federal Reserve of the USA (May 16th). The recent macroeconomic statistics from the U.S. suggests that the U.S. economy is on a growth trajectory, but it may be somewhat slower than expected in recent months. Therefore, the relevance of a possible early tightening of the monetary policy by the U.S. regulator is reduced, and the importance of the data on inflation decreases. Taking into account the fact that the meeting of the Federal Open Market Committee was followed by a press conference given by B. Bernanke, where he answered the most relevant questions, we believe that the market’s reaction to the “minutes” has the potential to be limited. The Dollar will likely continue its strengthening against the political uncertainty in the Eurozone. Continue Reading >>
In the period from May 7th until May 11th, the Dollar increased its pressure upon its major competitors. The weak data on the labor market in the USA in April, as well as the rise of political uncertainty in the Eurozone countries significantly reduced the risk aversion in global financial markets and triggered the sale on the stock markets and the strengthening of the U.S. currency. The USDX Dollar index, which is the ratio of the USD to a basket of six major world currencies, rose at the moment at 1.1%, reaching the mark of 80.435. On Friday, May 11th, the data on the Producers’ Prices Index could not make a significant impact on its positions.
The EUR/USD pair came under serious pressure after Nicolas Sarkozy had lost the presidential elections in France, and had been succeeded by a representative of the Socialist Party, Francois Hollande. In Greece, in the course of the parliamentary elections, the ruling party was also punished by voters for the measures aimed at reducing the social costs, and lost a majority in the parliament. It is obvious that the Eurozone enters a prolonged period of increased political uncertainty and the future of fiscal reforms, recently outlined by the governments of 25 EU countries, becomes less transparent. Due to these events, the EUR/USD overcame a technically important support level of 1.30 and is targeting the area of 1.26. Continue Reading >>
Some customers believe that the Megadroid’s strategy poorly suits the modern market. This is not quite so. Despite the fact that the first half of 2012 will most likely be completed at a loss, one should not delete the Megadroid’s strategy from the list of those profitable. Megadroid has been residing in the market for a long time and one has never encountered a series of losses, after which Megadroid could not restore itself.
As an example, let us have a look at the losses of 2011.07.14.
At that time, the EA lost about 160-200 pips altogether.
For the visualization, we will show the report made at that time period.
And this is the way the report looked already by the end of 2011.
The basics of technical analysis of the Japanese candlesticks
The shapes of fractured candlesticks
The continuation
«ABANDONED CHILD»
Comments
When a “Dodji-Star” makes a jump up without even touching shadows, followed by a jump down also without touching shadows, it is considered is a major signal for the upper fracture. This figure, called an ‘”Abandoned Child of the top”, is quite rare. The fracture is also true for the bottom of the “Dodji-Star,” which makes the jump before and after it, without touching shadows, signals main bottom. This figure is called an “Abandoned Child of the bottom”, and also occurs very rarely. The “Abandoned Child’s” formation is similar to the traditional island-like top or bottom, where Dodji is the island. Continue Reading >>
