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Forex Forum to Share, Discuss, Communicate and Trade Forex • FXB Blog - Forex Articles
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Re: FXB Blog - Forex Articles

PostPosted: Tue Sep 26, 2017 3:10 am
by FXB trading

Is time running out on US Dollar as the leading reserve currency?

The might of the USD and its position as the leading reserve currency has been called into question by numerous analysts over the years.

During periods of political and economic uncertainty doubts about the USD attract a wider audience, prompting further proclamations about its demise.

Some analysts claim a collapse is imminent, others predict that it is just a matter of time and yet it remains the most highly traded currency in forex, the dominant currency in international trading and remains the leading reserve currency.

It has history on its side and is clearly still trusted by its trading partners.

But the question of its future warrants consideration as it comes under threat from the EUR and other currencies who may be ready to challenge the USD as the dominant reserve currency.


When US President Donald Trump came to power in 2016 he pledged policies that would propel the value of the USD to new levels. The objective was to boost US structural economic growth while at the same time reducing the US trade deficit.

Trump’s plan was going to be achieved by making large investments in infrastructure and extensive tax reforms in combination with a highly protectionist trade policy.

Thus far Trump’s plans have been hamstrung by political division and budget constraints. The US trade deficit continues to grow and there’s been little sign of the promised protectionism.

Concurrently, doubts about the eurozone’s future, following the Grexit crisis and the shock of Brexit, have receded. Germany’s vision of economic convergence is shared by new French President, Emmanuel Macron, a pro-European reformist, and this axis has rejuvenated the EUR. It is pressing a strong claim, similar to when it was first launched, as a rival reserve currency as foreign investors shift capital into the eurozone.

If US trade deficit continues to grow while the eurozone finally delivers on its potential, then a sustained period of EUR performance would follow and prove it might be a viable alternative to the USD as the leading reserve currency. It’s one of the key conditions that would make the prospect of a USD collapse easier to accept and navigate through.

The eurozone is not alone in its ambition to establish the EUR as a reserve currency. China will also look to benefit from uncertainty regarding US’s strength, and Asian countries will be more sympathetic to their offer of a closer relationship.

Gold has also benefitted from the apparent weakening of USD’s status, recently peaking in value after years of slow decline.

Bitcoin has the potential to stake a claim, but it’s too soon to be sure if it can accede to the role.
Read more https://fxbtrading.com/fxb-blog/articles/time-running-us-dollar-leading-reserve-currency?

Re: FXB Blog - Forex Articles

PostPosted: Thu Sep 28, 2017 4:04 am
by FXB trading

Strategies for Successful Trading Decisions Going Short or Long

The Forex market is quickly becoming the focus of attention for millions of new entrants as a result of its unique advantages. A large number of people have learnt how to make clever investment choices in order to take advantage of the market. Two strategies in Forex are going long and going short – once you understand these two strategies you will be able to make important decisions in order to be profitable. The two main strategies will be examined below.

Going Short

This trading strategy is when the base currency is sold in order to buy it at a later stage when the price begins to fall, resulting in a return from the transaction. For example, if the current GBP/USD is 1.5345 meaning we pay 1.5345 Dollars for one Pound Sterling, and we have $1000 dollars, we would sell the Dollars in order to purchase the Pound Sterling. This is carried out when the cost is expected to fall again in a short period of time. When the price GBP/USD falls to 1.5350, this means that more Dollars can be purchased with the same amount of Pounds that were obtained at the start. The additional dollars can be kept as profit which were earned by considering the dollar as the base currency.

Risk in Short Position

As with all financial markets, forex involves the same amount of risk. If the prices go in the exact opposite direction than originally expected, there will be a loss instead of a profit. For example, if the GBP/USD goes to 1.5340, you would not even get the same amount of Dollars that you sold initially. This strategy is only profitable if prices drop.

Going Long

In the Forex Market, going long refers to buying of currencies with the intention of reselling them later when the price increases. If you notice an increasing trend of a currency for a long period of time, then buying would be the correct option and keeping the trade open until the price reaches its maximum point before reversing. For example, if GBP/USD is showing an increasing trend for the past few hours or days and the current price is 1.5400, then you can sell the Dollars to purchase the Pounds and wait for the prices to get to the desired level. When the price gets to 1.5500 you could sell as that earns you more Dollars than your initial investment.

Risk in Long Position

There is the risk of the price falling once you have purchased the currency. In this situation, your loss would equal the difference in the price at the point which you bought the currency and the price at which you are selling it. Regardless of the investment in the Forex market, it is essential to know the market trend and the economic conditions of the base currency.

Re: FXB Blog - Forex Articles

PostPosted: Mon Oct 02, 2017 2:56 am
by FXB trading

Advantages of Forex trading

Forex is an acronym for Foreign Exchange Markets. Forex is also represented by the symbol FX which is a familiar term among investors, bankers and stock brokers across the world. The Foreign Exchange Market or currency market is a global, decentralized market for trading of currencies. The principal participants in the FX market are major international banks.

Financial centers around the world offer buyers and sellers a convenient platform for trading in currencies. In addition, the FX market operates on several levels.

The unique advantages of FX trading.

24 hour market
FX trading operates on a 24/7 basis except for weekends. Trading around the world begins when the markets open in Australia on Sunday evening and closes when markets end at New York Stock Exchange on Friday evening.

High Liquidity
Liquidity is when you can easily change an asset into cash with minimum price fluctuations. In the forex market, transactions can easily be carried out by moving huge lots of foreign currencies in and out of the market with least price fluctuations.

Low transaction cost
The cost for a transaction is added with the price i.e. the buying price of the currency. This is known as a spread – the difference between the buying price and the selling price.

The leveraging factor is the ability to trade more money in the market than that which is actually available on the trader’s account. Forex brokers allow traders to make profits on the leveraging factor. If you are allowed to trade on a leverage factor of 50:1 ratio it means you can trade for $50 with $1 capital available on your account. You can control a trade volume of $50,000 with just $1000 worth of capital.

In order to be able to buy and sell foreign currencies, you need to open a Forex trading account online. For every FX currency you buy, your account will be credited with the same amount. For every FX transaction you carry out in terms of selling, the corresponding currency will be debited from your online Forex Account. The profits you gain will be wired directly into your account through Paypal.

Profit potential from rising and falling markets
You can trade freely in the market as far as your potential goes. If you believe that the price of a currency will increase, you can buy it or go long. Increased currency price indicates you can sell it at the increased price. You can make up for huge profits by trading on volumes. However, if you believe that the currency value is going to fall, you can sell it or go short.

Seasoned stock traders can make huge amount of profits and even become overnight millionaires. On the other hand, if you desire huge amount of profits and start trading without following the tricks of the trade you can also end up losing a lot of money. Therefore, you should always be cautious while you are operating in the Forex market or stock market.

Re: FXB Blog - Forex Articles

PostPosted: Wed Oct 04, 2017 3:57 am
by FXB trading

Avoid the pitfalls of forex trading robots

Forex trading robots have become a popular tool in the personal forex market. They’re often attractively priced and are marketed as ‘Expert Advisors’ that can operate on many of the favoured trading platforms. However, an increasing number of traders have been left disappointed with the purchase of their automated forex trading program that ends up performing well below expectations, which leaves them feeling cheated and even results in claims of fraud.

Sold on profits

Anybody with a product to sell will focus on the product’s most attractive features to get you to buy it, and that is especially true about automated trading products. Often, they’re presented as offering the path to financial freedom and being easy to use; claims that are backed up by historical trading profits and glowing testimonials from seemingly satisfied users. In reality, the evidence of their success is just a small sample of trading when the software enjoyed a profitable spell and leaves out the less impressive other periods which more accurately reflect its true capabilities and how it performs for most of the traders who buy it.

The disclaimer makes it alright

Every forex trading robot is sold with a disclaimer (sometimes well hidden) that denies any responsibility for how it will perform in the future. The words may be different each time, but the message always amounts to the same thing: there’s no guarantee this software will trade profitably based on its historical performance and is there to protect the vendor from potential fraud claims.

Get a refund but not your money back

In an effort to placate customers who were unhappy with their trading robot purchase, many vendors would simply offer a refund. But while the purchase price of the forex trading software would eventually end up back in their bank account, the money they lost using it was gone.

Trawl through any online trading forum and it won’t be long before you come across a thread full of unhappy traders who feel they’ve been misled by false advertising about forex trading robots that fail to deliver profits.

Traders who purchased the forex trading software through Clickbank tend to have an easier time getting a refund. Legitimate claims made by the purchaser within the 60-day / eight-week period are usually dealt with quickly and efficiently.

While it is not recommended that traders purchase a forex trading robot, if you do so, make the purchase using Clickbank and thoroughly test the software during the risk-free trial period to minimise the financial impact if the trading results prove to be disappointing.

Too good to be true

The saying goes: if it’s too good to be true, it probably isn’t. Genuine innovation has made our lives easier and better, but if trading software was capable of delivering the results vendors claim it can – and for such a small investment – why do banks continue to pay their forex traders six figure salaries?

The simple truth is that it isn’t possible for trading software to deliver positive results on a consistent basis. Successful forex trading can be learned and is highly profitable, but it requires skills and judgement that simply can’t be replicated by software.

Re: FXB Blog - Forex Articles

PostPosted: Fri Oct 06, 2017 5:49 am
by FXB trading

Forex coaching pays dividends

Trading forex is a bit like driving, if you don’t get a few lessons from someone who knows what they’re doing you’ll probably crash. A good forex trading coach will help you become a profitable trader far sooner than if you dive into trading without proper training.

A good trading coach, much like a good driving instructor, is aware of the mistakes a novice is likely to make and is able to steer you around or away from them and can explain why a certain course of action or choice is the better option. Much like driving, most of us want to learn so that we can use it safely, frequently and of course successfully. Driving without caution or at high speeds, without understanding the dangers, mirrors unprofitable or high risk trading and inherently increases the chance of losing money.

Once you’ve accepted that coaching is the best way to start the next step is choosing which coach is right for you. In most situations where you need an expert, your natural instinct is to gravitate to the best available. This is where most people run into their first hurdle, as the industry is littered with so-called ‘forex gurus’ but who are not even professional traders.

A recommendation from someone you know and trust is always a good place to start, but if no-one you know can advise you on coaching for forex trading there are some things to look out for which will help you make an informed choice.

‘Try before you buy’ is a good way to get a better idea of the quality of the training a forex coach is able to provide, so it makes sense to look into some of the free training advice your potential coach might offer on their website.

If the coach you’re looking at doesn’t offer any advice for free and is simply trying to sell you a product that makes some grand promises based on past performance it is best to stay clear.

Another simple test to carry out is to discover if you are dealing with a real person. A forex coach who features in his or her own videos and uses their real name is more likely to be a genuine trader with something useful to offer. Try out the phone number, email or any other contact information provided and check out if they are really on the other end of that communication line. If they are present it means they’re also accountable and that is a sure sign they are confident in what they’re offering.

People who constantly seek out new learning tend to be more successful than those who settle on what they know and plod a familiar path. Coaching provides an ongoing learning process, even for those who are already at the top of their own mountain. When Rafael Nadal achieved Number 1 status in the tennis world the first thing he did was increase his coaching staff.

It’s one thing to learn something, learning to apply that knowledge is the next step then learning from your own experiences is yet another. This applies as much to forex as it does to all walks in life that require special skill or knowledge. Forex coaching provides the opportunity for continuous learning, regardless of how long you’ve been trading, and is an essential component of long-term success.

One-on-one training has been shown to increase the rate someone learns by 70%-80% and there is no quicker way to learn how to make consistent profits in forex trading.

5 reasons why coaching will make you a better trader:

1. Our natural instincts teach us to learn from our mistakes and novice traders naturally employ this trial and error method. However, this results in a novice taking longer to learn how to trade profitably, sometimes years, and in that time they are likely to have picked up some bad habits. A trading coach will challenge the way you think and your trading paradigm, the trading coach will also identify your bad habits and help you replace them with profitable strategies.

2. Nobody likes being told they’ve done something wrong and it’s one of the reasons some traders resist the idea of training. But throughout our lives the biggest and most important lessons we learn is through the mistakes we make, not our successes. A good trading coach will be able to offer constructive criticism and teach you how to learn from mistakes.

3. Some, if not most, people who start out in forex dream of achieving huge wealth and overnight success. Forex trading is about creating a plan with realistic weekly, monthly and yearly goals that get a trader to a target. Having a target without a plan is simply dreaming. A forex coach will help you establish realistic and achievable goals that will ensure you reach your target.

4. A common problem novice traders face is becoming overwhelmed with irrelevant information. A trading coach will help you to focus on the information that matters and how to stay focussed on the information and avoid wasting time on details that can steer a trader away from their targets.

5. Another common problem that afflicts traders is when they get stuck on a certain level of knowledge. It can be hard for a trader to recognise this in themselves which is why having a coach is vital as they will see it and know how to get a trader to move forwards again.

In short, a good coach will tell you what you need to hear when you don’t, and see what you need to see when you can’t. A good coach will help you achieve your goals.

In the past coaching was seen as something that only professional athletes used, but successful traders have realised the benefits of forex coaching. In the long term it saves a trader time and money and eventually proves to be a worthwhile investment for the future

Re: FXB Blog - Forex Articles

PostPosted: Tue Oct 10, 2017 3:22 am
by FXB trading

Profit from North Korea crisis

The North Korean crisis has been preoccupying the minds of investors for a few months now. Back in April, North Korean leader Kim Jong-un ordered missiles to be fired over neighbouring Japan. The ensuing market instability prompted varied reactions from investors.

The risk averse headed for the safe haven markets, while others tried to capitalise on market volatility.

Today, the picture for investors has changed significantly.

As you read this (September 18) world stocks are at an all-time high. Investors have regained their appetite for trading in risky assets. Currency trading appears unaffected by events on the Korean Peninsula.


The markets have breathed a collective sigh of relief and for traders, with the risk of a nuclear war averted, North Korea has drifted to the back of their minds – for the time being.

The note of caution is sounded because it’s far from being a settled issue, and major powers are already drawn in.

On Sunday (September 17) US President Donald Trump appeared to mock Kim Jong-un.

“I spoke with President Moon of South Korea last night,” the US president wrote. “Asked him how Rocket Man is doing. Long gas lines forming in North Korea. Too bad!”

Despite the rhetoric employed by Trump and the US administration that “fire and fury” would be the US reaction to Kim Jong-un’s continued missile firing, their preference, so far, has been to see economic sanctions imposed on North Korea.


The United Nations Security Council passed sanctions against North Korea. In turn, Kim Jong-un responded by firing another intermediate-range ballistic missile that flew over Japan and a promise that more tests were on the way.

These sanctions seem to be taking effect on the country, hence the reference to “Long gas lines”, if not Kim Jong-un himself.

A notable side effect to the crisis has been its effect on US/China relations which saw US Treasury Secretary Steve Mnuchin threaten a trade war with China if it didn’t uphold its sanctions against North Korea.

The markets would react with far more volatility if this were to transpire, and you can be sure investors will be paying special attention to US/China relations as the North Korean crisis unfolds.


But, for now, it seems investors have become desensitised to the North Korean issue. As long as Kim Jong-un holds back from declaring all-out war and US/China trade relations remain intact, the market seems to have decided that trading shouldn’t be affected.

Stock markets in Asia are at their highest level in a decade (Monday, September 18) and this positivity is mirrored in markets around the world.

However, if fears about war increase again, look out for its effect on the value of the USD.

Historically, the USD’s value plummets when there is trouble on the Korean Peninsula. Going back to 2010, when tensions were provoked by South Korea, the value of the USD dropped significantly against other major currencies.

Both the US and North Korea show no intention of backing down, so an escalation is still possible. In the short term, this would most likely see the value of USD increase, as it’s a war North Korea can’t win. But war in the region would inevitably see South Korea and Japan being sucked in and result in collateral damage to those nations. They are both trading partners with the US and this could end up having a negative effect on the value of the USD

Re: FXB Blog - Forex Articles

PostPosted: Tue Oct 24, 2017 3:19 am
by FXB trading

Learn to read between the lines to make better trades

So, you’ve got the trading bug. You’ve made your first profits – albeit modest – by making safe trades.

There are riskier trading strategies that can earn bigger profits. You know about them, you’ve been warned about them, and you’re not interested because the downside is too great.

So how do top traders end up making so much more money?

It’s not by taking bigger risks.

Profitable traders earn more because they’re better at predicting and understanding how markets react to news and economic data. They read between the lines of the constant stream of information that is available on trading platforms to make more profitable judgements.

The best traders use information to make a trade before the trend becomes visible to others.

For profitable traders, breaking news stories and economic data is information to be deciphered into factors that can affect the market.

It’s not easy. If it was everyone would do it. But it’s far from impossible, and can be learned.

Understanding economic performance and what affects it is an area that profitable traders excel.

What follows are examples that demonstrate the importance of being able to translate data and news into something meaningful.

Example 1. Gross Domestic Product (GDP) is one of the key indicators used to gauge how a country’s economy is performing.

During the last recession in the US economy’s GDP was $14.3 trillion (2008), $14.2 trillion (2009) and $14.6 trillion (2010).

During one of the worst economic periods in recent history the US economy was actually flattish and ever-so-slightly growing.

But it felt much, much worse and to most people it probably felt like it was shrinking.

So why the disparity between perception and the economic indicator?

The answer is that America has been accustomed to growth. Since 1945 the US economy had averaged 3.3% growth per year.

Small changes in GDP can have a huge impact in stock market values. 4% feels like a boom and is reflected in consumer sentiment. 2% growth feels like a recession and flat conjures up bleak, black and white newsreel from the 1930s.

Any GDP figures above the 3.3% average triggers investors to pull their money out of safe havens, employers start hiring and consumers start buying. Anything less than the 3.3% average triggers negative reactions.

Example 2. How should you react when Apple, IBM or Microsoft post successful quarterly, half-year or yearly results?

These are companies with combined revenues that run into the hundreds of billions of dollars. So, clearly, they are important. But a far more significant indicator of economic health is the success of startups, not the giant corporations.

The Kauffman Foundation, the US’s top entrepreneurial think tank, revealed that the most important contributor to a nation’s economic growth is the number of startups that generate billion-dollar revenues within 20 years.

They suggest that the US needs between 75-125 billion-dollar startups per year to maintain economic growth.

Example 3. GDP is a widely used by economists to measure economic progress, but it falls short of incorporating the impact the economy is having on average citizens and the day-to-day realities of life.

The Genuine Progress Indicator (GPI) was created in 1995 by the Redefining Progress think tank as an alternative measure to GDP and tries to reveal a perspective on a nation’s economic prosperity.

GPI and GDP calculations are based on the same personal consumption data, but GPI is adjusted by applying monetary values to non-monetary aspects of the economy.

Many GPI factors have a direct impact on people’s quality of life, while traditional economic focus is more strictly on making money.

So far, it has been adopted except in Canada and some smaller European nations. But it has been reviewed by the scientific community and recognised for its validity at gauging the public’s consciousness, which is critical for understanding how an economy feels to consumers.

There are also some popular economic ‘myths’ involving government that need to be debunked to clarify their relevance and impact.

‘Increased government spending helps the economy grow.’ All monies that a government injects into the economy must first be taxed or borrowed. It doesn’t create new income or increase production it simply moves money to another part of the economy.

‘Government spending makes people more productive.’ This can often have the opposite effect, and can make an economy worse. For example, there are some welfare programmes that encourage recipients to rely on government handouts rather than work. However, spending on infrastructure improvements can reduce transport costs which can then increase productivity and help the economy.

‘Governments should bail out faltering industries to revive the economy.’ Again, the opposite is largely true. Bailouts effectively reward reckless spending and encourage more of the same in the future. However, government leaders are sensitive to bad headlines, for instance when a high-profile company closure will result in widespread job losses. Politically, it makes sense to save those jobs with a bail out, but not economically, especially if they are not followed up with measures to improve how that organisation runs its finances in the future.

‘Tax cuts only reward the rich.’ Strategically programmed tax cuts stimulate economic growth by encouraging work, savings and investment. In the US high tax rates were reduced during the 1920s, 1960s and 1980s. Economic growth and increased investment followed. The economy grew 59% from 1921 to 1929, 42% from 1961 to 1968 and 34% from 1982 to 1989.

The populist headline that usually follows high end tax cuts is that the government are simply helping the rich get richer. To an extent this is true, but they also create more jobs, help people to save for their children’s education and increase earnings in general.

The real point is that the ‘rich’ got rich because they are better at making money than other people and are far better at using money than most governments.

Some traders are better than others because they are better at understanding economic data and news and its implications.

And now you know how to become a better trader.

Re: FXB Blog - Forex Articles

PostPosted: Thu Oct 26, 2017 12:39 am
by FXB trading

It’s going to get volatile sooner or later

Strap yourselves in, the markets are going on a rollercoaster ride. And depending on your appetite for risk you should prepare your portfolios accordingly.

If you want to protect what you have, the sign posts to the safe havens haven’t changed and are easy to read.

If you want to try and ride the volatility and believe you have the know-how to profit from it, then take a deep breath and start reading between the lines of news stories. There’s no roadmap for this because the outcome is far from certain.

The ongoing chess match between two superpowers has reached a critical point, and control of the Arab states is set to be redefined according to whose plans play out the most successfully with Syria as the focal point.

From 2012, former US President Barack Obama argued that the US shouldn’t intervene in Syria’s civil war, wary of the anti-US atmosphere resulting from conflicts in Iraq and Afghanistan.

Russian President Vladimir Putin stepped in and directed the Syrian conflict in favor of Russia, Iran and the Assad regime at the expense of the US and its Arab, Israeli and Turkish allies.

Perhaps it was payback for Washington meddling in Serbia and Bosnia in the 1990s.

Turkey, a long time US ally, now seems to be aligning themselves closer to Russia. The King of Saudi Arabia has just made the first ever state visit to Russia in a prologue to billions of dollars’ worth of deals between the two nations.

If Russia continue unchecked they’ll have a greater influence on the Middle East than the US, and that’s a situation the Americans cannot allow to happen – they’ll have to react – and that’s the big unknown. How they react and the outcomes that result are going to cause volatility in the markets.

So how does a trader prepare – or take advantage – of this upcoming situation?

Expect the currency markets and the price of oil to experience the highest levels of volatility in the wake of an escalation of conflict in the Middle East – especially in European stock markets. But other commodities will also experience volatility.

Significant movement in the VIX (Volatility Index) – also known as the fear index – reflects the market participants perception about the market’s future volatility.

The safe havens, like Gold and other precious metals, tend to do well during periods of extreme volatility.

It’s no coincidence that Russia has been stockpiling gold for years, and despite official figures no-one really knows how much they are holding because they’ve also been mining gold at a far greater intensity in recent years.

Gold is the insurance policy countries take out when currencies are set to fall, China has also followed Russia’s lead on gold and this could be very significant if the US dollar loses its status as the leading reserve currency.

Those hoping that Cryptocurrencies can step into the breach and restore calm to volatile currency markets need to bear in mind that their very existence is still precarious. If it doesn’t yet have the backing of the central banks it’s hard to envisage a reality where it is taken up in a significant enough volume to be able to provide buoyancy to free-falling currencies. This could explain why China has blocked Cryptocurrencies – perhaps it has designs to take over from the USD as the leading reserve currency.

As ever, the financial institutions will play a significant role in how the markets react.

New money has been pumped into economies at unprecedented levels in recent years in an effort to promote sustainable growth. But at the same time world debt has increased to a point where a significant crash is no longer being talked about in terms of ‘when’ and not ‘if’.

Why? Because world debt has increased to a point where it can no longer be paid off. It’s at $65 trillion and climbing.

If you were to ask a real estate agent to put a value on the value of all the land in the world today, based on current market values, it wouldn’t come anywhere near the figure of debt that countries have accumulated.

And what happens when what you own is worth less than what you owe and you can’t pay it back? The bank forecloses.

This will translate into an economic crash of proportions that have not been witnessed before. Years of depression will follow, as global economies effectively press the reset button to bring debt back to manageable proportions.

It’s time to prepare for the volatility, it’s coming.

Re: FXB Blog - Forex Articles

PostPosted: Fri Oct 27, 2017 4:41 am
by Nathan Fields
On the currency exchange market in every country, the local currency is quoted directly or indirectly against the US dollar and other foreign currencies. The direct quote is the amount of local currency needed to buy one unit of the foreign currency and the amount of local currency, respectively, due to be received when one unit of foreign currency is being sold. I am with FreshForex and I know how currency market works.
From them, I have gathered all successful trading tips with essential terms and conditions that I always use during my trading for making handsome amount of profit. Also, I am getting technical analysis tools, real time charts, real time news and data, and software or website support with them.

Re: FXB Blog - Forex Articles

PostPosted: Mon Oct 30, 2017 2:52 am
by FXB trading

Don’t bank on the banks
As earnings season edges closer, investors are looking over the banking sector’s biggest names to assess their potential.

JPMorgan (JPM) and Citigroup (C) release their figures first, followed by Wells Fargo (WFC) and Bank of America (BAC) then Goldman Sachs (GS) and Morgan Stanley (MS).

US banks have benefited recently from a perceived likelihood of interest rate increases from the US Federal Reserve. However, much of these banks’ future performance will depend on the tax cuts that US President Donald Trump proposed recently, and the ability of his administration to get them through Congress.

If passed, net income of the big six banks could rise $6.4 billion with Wells Fargo, Bank of America and JPMorgan the biggest beneficiaries, according to a recent Bloomberg report.

However, Trump’s administration has been frustrated by Congress’ unwillingness to back the president on a number of policies that he has wanted to pass since coming into power.

And Morgan Stanley’s chief US equity strategist, Mike Wilson, claims that S&P 500 companies will not hit their 2018 estimates without them.

JPMorgan chief executive Jamie Dimon predicted a 20% year-on-year decline in the bank’s trading revenues. However, analysts are expecting JPMorgan to report EPS (earnings per share) of $1.66, an increase from the $1.58 recorded in the same period last year despite revenues falling year-on-year to reach $25.3bn.

Citigroup’s chief financial officer offered a similar outlook revealing that total market revenues are down 15% in the third quarter. However, Citigroup EPS are forecast to be $1.30, six cents higher than the same quarter earnings posted last year.

Wells Fargo’s problems are self-inflicted as they are struggling to shrug off the battering their reputation took as a result of numerous recent scandals. Wells Fargo may be legendary investor Warren Buffet’s favourite stock but earnings are expected to be less than 1% up on last year.

Bank of America warned earlier this month that trading revenue in the third quarter is expected to be down 20% and that this is may have a negative effect on its quarterly earnings report.

Goldman Sachs produced record revenues in the first three months of the year and maintained a strong performance throughout the first six months. Goldman Sachs co-president Harvey Schwartz is predicting similar figures for the third quarter. Despite this the bank seem to have missed out on the recent big bank rally with its share price up just 1%. The EPS forecast is $4.25 down on last year’s $4.88.

Morgan Stanley’s share price has increased more than 16% this year. Analysts forecast EPS of $0.84, up exactly $0.04 from 2014’s $0.8 EPS.

For more advice on the banking sector and how to capitalise on share price movements talk to the experts at FXB Trading.