New York, NY (PRWEB) February 27, 2006 –-
Forex traders almost always rely on fundamental analysis to map out their currency trading strategies at the beginning of each year. Fundamental analysis involves heavy examination of the value of a nation’s currency based on macroeconomic indicators, asset markets, and political affairs. As the currency market grows another year older, it is becoming more important for Forex traders to stay informed of developing circumstances that may affect the 2006 currency market. Among the well-regarded Forex companies that distribute 2006 Forex Forecasts, CMS Forex is the most anticipated of the bunch – offering the most up-to-date, concise analysis on the currency market.
CMS Forex, one of the world’s largest online currency trading institutions, is releasing its 2006 Forex Forecast today. The Forex Forecast explains that the volatile situation in the Middle East might have a dramatic affect on the currency market this year. The Forex forecast mentions that things have become so tense with Ariel Sharon’s health woes and the election victory of Hamas that the Iranian nuclear threat has been pushed to the backburner.
CMS Forex’s 2006 Forex Forecast explains that on January 20th the Israeli Defense Minister announced that Israel would use all necessary means to prevent Iran from developing nuclear weapons. In reaction to this news, EUR USD reached a four-month low on January 23rd. A simultaneous increase in demand for the Swiss Fanc, seen as a safe haven during uncertain periods, led to a rise in the value of that currency. The Euro was falling against the Franc even as it rose against the Dollar.
Gold is another area of interest to Forex traders when deciding what to expect in the year 2006. In 2005, the price of gold increased 18%, reaching a 25-year high. CMS Forex 2006 Forex Forecast predicts a further rise this year to $550 per troy ounce. CMS Forex experts were insufficiently optimistic in this case, as this target was passed in the first days of the New Year. This turn of events was mainly a result of China’s announced diversification of its reserves from U.S. Dollars into gold, CMS Forex’s forecast states. At the start of 2006, gold constituted just 1% of the Chinese central bank’s holdings. For most developed countries, this figure is 10%. For China to reach this goal it will have to buy an estimated $600 billion worth of gold. While this purchase will probably be executed over an extended length of time, it is and will continue to be a significant influence on currency prices, CMS Forex predicts.
CMS Forex writes in its 2006 Forex Forecast that the U.S. economy will be a major influence on the 2006 currency market. Despite its relatively strong finish at the end of 2005, there is much concern around the world about the U.S.’s massive national debt and trade and budget deficits, the Forex forecast states. In fact, many nations’ central banks are expected to follow China’s lead in selling off their Dollar reserves. As long as the U.S. economy shows enough growth to warrant continued confidence, demand will balance supply. If the U.S. is unable to do so, there is danger that the demand will plummet precipitously, leading to a sudden fall in the price of the dollar, CMS Forex’s forecast states.
CMS Forex’s 2006 Forex Forecast highlights that the demand for the Dollar will depend on the progress of the war in Iraq. This, in turn, will depend on the ability of the dominant Shiite majority to form a stable coalition government that includes Sunni and Kurd minorities. With the U.S. planning to reduce its level of military troops, it is also vital that the Iraqi government build up its army and police forces to prevent the security situation from deteriorating beyond its current state. While it is impossible to predict how far Iraq will advance in the next year, CMS Forex’s 2006 Forex Forecast says it is safe to say that it will not be fully stabilized.
The complete version of CMS Forex's 2006 Forex Forecast is available on the CMS Forex website (http://www.cmsfx.com) at http://www.cmsfx.com/en/resources/2006-forex-forecast/.
About CMS Forex
CMS Forex is one of the world's largest online currency trading institutions. Having achieved 800% revenue growth in the past three years, CMS Forex has secured itself and its clients for the future. Since its founding in 1999, CMS Forex has striven to serve the emerging retail segment of the Forex community. Through its commitment to providing user-friendly, innovative technology, fair dealing practices, and excellent customer service, CMS Forex has quickly become a major force in today’s Forex arena.
CMS Forex’s mission is provide the most relevant and powerful trading technology to clients in the most convenient, user-friendly platform – providing a customizable interface that allows chart-based trading, customizable 100+ tools and technical indicators, and up-to-the-minute Forex news. CMS Forex is dedicated to the protection of traders’ investments and is proud to be a registered Futures Commission Merchant (FCM), a member of the National Futures Association (NFA) (Member ID# 0313199) and to be regulated by the Commodity Futures Trading Commission (CFTC).
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