Day Trading and Swing Trading the Currency Market gives forex traders the strategies and skills they need to approach this highly competitive arena on an equal footing with major institutions. Now in it's third edition, this invaluable guide provides the latest statistics, data, and analysis of recent events, giving you the most up-to-date picture of the state of the fast-moving foreign exchange markets. You'll learn how the interbank currency markets work, and how to borrow strategy from the biggest players to profit from trends. Clear and comprehensive, this book describes the technical and fundamental strategies that allow individual traders to compete with bank traders, and gives you comprehensive explanations of strategies involving intermarket relationships, interest rate differentials, option volatilities, news events, and more. The companion website gives you access to video seminars on how to be a better trader, providing another leg up in this competitive market.

The multi-billion-dollar foreign exchange market is the most actively traded market in the world. With online trading platforms now offering retail traders direct access to the interbank foreign exchange market, there's never been a better time for individuals to learn the ropes of this somewhat secretive area. This book is your complete guide to forex trading, equipping you to play with the big guys and win—on your own terms.

• Understand how the foreign currency markets work, and the forces that move them
• Analyze the market to profit from short-term swings using time-tested strategies
• Learn a variety of technical trades for navigating overbought or oversold markets
• Examine the unique characteristics of various currency pairs

Many of the world's most successful traders have made the bulk of their winnings in the currency market, and now it's your turn. Day Trading and Swing Trading the Currency Market is the must-have guide for all foreign exchange traders.

Preface ix

About the Author xi

Chapter 1 Foreign Exchange—The Fastest Growing Market of Our Time 1

Chapter 2 Historical Events in the FX Markets 17

Chapter 3 What Moves the Currency Market? 31

Chapter 4 A Deeper Look at the FX Market 53

Chapter 5 What Are the Most Market Moving Economic Data? 61

Chapter 6 What Are Currency Correlations, and How Can We Use Them? 67

Chapter 7 Trade Parameters for Various Market Conditions 73

Chapter 8 Technical Trading Strategy: Multiple Time Frame Analysis 91

Chapter 9 Technical Strategy: Trading with Double Bollinger Bands 101

Chapter 10 Technical Trading Strategy: Fading the Double Zeros 111

Chapter 11 Technical Trading Strategy: Waiting for the Deal 117

Chapter 12 Technical Trading Strategy: Inside Days Breakout Play 123

Chapter 13 Technical Trading Strategy: Fader 129

Chapter 14 Technical Trading Strategy: 20-Day Breakout Trade 135

Chapter 15 Technical Trading Strategy: Channels 139

Chapter 16 Technical Trading Strategy: Perfect Order 143

Chapter 17 Fundamental Trading Strategy: Pairing Strong with Weak 149

Chapter 18 Fundamental Trading Strategy: The Leveraged Carry Trade 153

Chapter 19 Fundamental Trading Strategy: Macro Event Driven Trade 161

Chapter 20 Quantitative Easing and Its Impact on Forex 169

Chapter 21 Fundamental Trading Strategy: Commodity Prices as a Leading Indicator 177

Chapter 22 Fundamental Strategy: Using Bond Spreads as a Leading Indicator for FX 181

Chapter 23 Fundamental Trading Strategy: Risk Reversals 187

Chapter 24 Fundamental Trading Strategy: Using Option Volatilities to Time Market Movements 191

Chapter 25 Fundamental Trading Strategy: Intervention 195

Chapter 26 Currency Profiles and Outlook 203

Chapter 27 Currency Profile: Euro (EUR) 213

Chapter 28 Currency Profile: British Pound (GBP) 223

Chapter 29 Currency Profile: Swiss Franc (CHF) 231

Chapter 30 Currency Profile: Japanese Yen (JPY) 239

Chapter 31 Currency Profile: Australian Dollar (AUD) 247

Chapter 32 Currency Profile: New Zealand Dollar (NZD) 255

Chapter 33 Currency Profile: Canadian Dollar (CAD) 263

Index 269

KATHY LIEN is Managing Director of FX Strategy for BK Asset Management and Co-Founder of BKForex.com. Having graduated New York University's Stern School of Business at the age of 18, Kathy immediately started working on Wall Street, where she earned more than 13 years of experience in the financial markets with a focus on G20 currencies. Her career started at J.P. Morgan Chase where she worked on the interbank FX trading desk and later in the cross markets proprietary trading group. As an expert on G20 currencies, Kathy is often quoted in The Wall Street Journal, Reuters, Marketwatch, Associated Press, UK Telegraph, Sydney Morning Herald, and other leading news publications. She is also an internationally published author of the bestselling book Day Trading and Swing Trading the Currency Market as well as The Little Book of Currency Trading and Millionaire Traders: How Everyday People Beat Wall Street at its Own Game.