Somebody can help me? I am looking for a web or company that have the service of detect the intrinsic value of the currencies. Somebody know of any?
Thanks very much.
There is no such thing as the “intrinsic value” of a currency. A currency is simply a medium of exchange, whose value is relative to other currencies, or to [B]things[/B] which do have intrinsic value.
Food, fuel, land, tools, etc. — these [B]things[/B] have intrinsic value, because you can use them to survive, to create, and to prosper. If you were placed on a barren, desert island [B]with nothing but currency[/B], you would starve to death.
Gold has intrinsic value — as works of art, as jewelry, as “bling”. But, as so-called “hard currency”, gold — like all currencies — has no intrinsic value. It has only relative value, based on how it’s priced in terms of other currencies.
If you want a non-currency basis against which to measure all national currencies, then gold is as good as any. But, how would that be useful to a forex trader?
If you have to determine the value of the U.S. dollar in terms of gold, and then determine the value of the British pound in terms
of gold, [B]in order to calculate the value of the pound in terms of dollars[/B], all you have done is complicate your life with a bunch of arithmetic.
Every second of every trading day [B]the market tells you what the pound is worth in terms of dollars[/B] (or any other important currency) — and you don’t even have to do the math.
Clint
I’m with Clint on this one. I can see things like stocks having an intrinsic value, because of the physical assets of the company, but a currency doesn’t have any intrinsic value other than the fact you can use it for toilet paper if the country backing it collapses.
If you don’t believe me just ask someone from Zimbabwe what the intrinsic value of the ZWD is right now. 
How about a web that give me the service of predict the market direction for economics indicator
Great explanation!!!
I agree with that, and I think the explanation and example are very good for a newbie.
This should be a �sticky� thread.
Regards!
July 23, 2009 11:25 EST.
Take these 300 pips.
GBP/JPY Sell 1 unit @ 157.30. Sell another 157.40
Stops for both 157.87
1st limit 154.938
2nd limit 153.25
Risk 0.75% of your balance.
Its now 21:42 EST
The only thing I can help you with is giving my opinion.
I don’t even know what in instri…whatever the word is. I basically trade off trends, support and resistance. I mainly concentrate on the 4hr chart. I hope you are into the GBP/JPY trade, its 120 pips positive as I type. I sent that trade to you earlier.
Notice I said trade 0.75% of your balance, I use the other 0.25 just to break even once the trade starts to go positive. I actually place a third unit at 157.50 and bail out at 120 pips then move my other 2 stops to break even.
Look at the GBP/CHF 4 hr chart, the daily trend is up so you want to follow the trend but at some point it has to retrace. If it is retracing now then fib. shows strong support at 1.7630. Follow me, major supports are on 7/13/09 - 1.7392, on 7/17 - 1.7547 and on 7/21 - 1.7481. Draw a trend line from 1.7392 to 1.7481, now draw a paralell line to that line, from 1.7547. If market condition remain the same the the price should hit the paralell line round about 1.7630 in about 4 4hr periods, exactly where fib puts it. I am new to trading but I’m trading like that and its working, just off sheer observation. I set my RR ratio high 3:1, 4:1 sometimes.
The GBP/JPY trade is against the trend but I feel strong about it. The last target might be pushing it a little but I think the EUR/USD dollar looks bearish and the GBP/JPY kinda follow that pair around a little.
I’m still wondering if its luck, I figure with all the speculations and analysing some of it boils down to luck and instinct. If I am wrong can someone please point it out to me.
Good luck Bro.
I’m with Clint.
What “goes” up or down are the dollar figures we have all been trained to attach to it - but we all know, for a fact, how illusory those are.
Today, a “dollar” is primarily an accounting unit. Nothing more than a concept, an idea - and a very fleeting one at that. It is created just like that, and it can be destroyed just like that, and it’s the same thing with all other fiat currencies.
[B]Fiat = Government issued by fiat (Latin for “let it be” or “so be it” - money simply ordered into existence by the sovereign)[/B]
Currencies are pure legal fictions. They are treated by the law as property, but just like corporations aren’t really “persons” they are not property themselves. Today, it is literally impossible for you to hold “a dollar” in your hand. All you can hold is either a piece of paper that says it is a federal reserve note and that carries the legend “dollar” next to a number imprinted on it, or you can hold a piece of gold or silver in your hand that states it is “worth” so-and-so many dollars - and you KNOW that the number is way off.
In times like these, the accounting unit, i.e., the mental concept of what an ounce of gold is “worth” to most people (and at which price they are willing to exchange it for something else) is said to be less than 1000 of those ideas, those afterthoughts, we call “dollars.”
So what? Who cares? 