High returns on low investments with benefits to all, this is what binary option trading has come up as. The day traders are a happy lot with the introduction of binary option trading. Before we move on to how to make money with binary options it is very important to understand what is binary option trading and how it works.

The term binary is a term related to computers where it means two that is there are two digits one or zero. When the term binary is applied to financial trading, it means that the trading option has only two outcomes, either zero or one or more specifically all or nothing. Again this means that the trader either gets cash or nothing. Simply, binary option trading can be defined as the contract where the trader receives the predetermined amount of cash if certain specified conditions or the relevant price movement occurs and his contract ends “in the money”, at the end of the expiry time. If the contract ends “out of money” he is not liable to receive anything.

One must remember that though there is an element of risk associated with binary option trading, as with other instruments of trading, yet with proper planning and execution, a trader can make good profits. Here the traders do not have to predict the exact price to be able to get the payout. Even if the prediction is correct by a single tick, it leads to the contract being “in the money” and hence liable for payout.

Money making strategies with binary options

1. The pairing strategy: the use of the pairing strategy is capable of yielding high returns. As per this strategy, the traders pair up the ‘an’ in the money call and money put. If at the time of expiry, the spot price is between the two prices as mentioned in the contract, the trader still makes money as a nested position had been created by the pairing.

2. Binary options betting strategy: another common strategy that is applied by traders to make money with binary options trading is by the betting strategy. Here the trader expects a big movement in the market and hence makes a call or put option. The strategy of betting depends on the fact that people choose indicators that affect the market price in a big way and put positions on these indicators.

3. Hedge and double position: this strategy of hedging and double the position is very helpful in making huge profits for the traders. Under this strategy the traders pair the call with the put into a hedge and double position.

4. Stop-loss strategy: probably the most popular strategy followed by traders to make profits is the stop loss trading strategy. Though the strategy looks simple but it needs experience and expertise for proper implementation. The trader should be able to judge the correct time of stop loss. The strategy depends on many factors like:

• Trading vehicle: the success of the strategy depends on the market tool being used by the trader because each tool follows its own stop-loss strategy. This can be gauged from the fact that a stock trader looks for constant stop loss levels but an options trader can select a two dimensional stop loss strategy.
• Risk tolerance: the stop loss strategy of any trader depends on the capacity of the trader to bear risks. There are numerous traders in the market all having different temperaments and hence the strategy of risk tolerance depends on the personal preference of each trader.
• Behavior of the market: the behavior of the stock markets also has a bearing on the strategy being adopted by a trader. Volatile markets mean flexible strategies whereas quiet markets invoke tighter strategies.
• Trading style: the trading style of different traders is different and hence the stop loss strategy followed by these traders is different.

Bungee option strategy: this strategy is based upon the fact that binary option trading has only two possible outcomes and therefore the turnover is quick. High returns in quick time lure the traders to adopt this strategy and at times the trades offer returns as high as 60 to 70%.
Besides these strategies, the following are some of the tips that can be followed to make money with binary options:
1. Choice of securities: as a trader you must choose the companies that have been posting positive results. This means that if a sector is doing well, then the companies under the sector would do well.
2. Quantity over quality: under binary options trading, quantity is considered better than quality. This is because the traders have to just predict the direction of the price movement and are not concerned with the magnitude of the movement of the price.
3. Hedging: the simplest way to make money with binary options is by hedging. This means that if at a time before the expiry there is a favorable price movement, the trader should hedge his contract either fully or partially to lock in the existing profits .

You finally can open a real trader account with anyoption and earn up to 71% an hour !

An early attempt by the USD to push higher failed to gather much traction as the European session got underway. EUR/USD failed to sustain a dip below USD1.4500 despite a EUR negative FT report that Portugal faces the risk of a downgrade. While USD/JPY remains off its overnight lows it continues to struggle to pull back to 92.50. Friday’s US payrolls data proved that the market had got too far ahead of itself with respect to optimism on the US economy. The slowdown in job losses did slow markedly during Q4 (to a monthly average of -69K from -199K in Q3), but the USD was priced for a return to job creation in December to sustain its view that the Fed is on the cusp of changing its policy stance.

Comments from the Fed’s Bullard in Asian hours that rates would remain low “for quite some time” were another blow to sentiment to the USD. Going forward, the market is likely to come to terms with the outlook that while the worst is likely over for the US economy, 2010 will likely prove to be a tough year for economic growth. The USD, however, is likely to garner some support from the outlook that the Fed is likely to be out of the starting blocks well ahead of the BoJ and the ECB with respect to rate rises this cycle. Now that payrolls data are out of the way and with this week’s data calendar relatively light attention can be expected to turn towards US earnings session which kicks off today.

Strong Chinese exports data overnight underpinned risk appetite. Exports rose 17.7% y/y in December boosting expectations for economic growth in the region. Chinese lending data was also strong. This will ensure fears remains about the potential for asset price bubbles in China though these fears will be soothed to some extent by measures announced by the State Council aimed at cooling the property market. AUD/USD has clawed its way up to USD0.9319 this morning aided by a rise in job vacancies to a 2.5 year high. The strong labour market is rekindling expectations that the RBA could hike rates again in Feb. Strong house price data in NZ has helped push the NZD above USD0.7400. USD/CAD, however, has backed off from a test of 1.0250.

The improvement in risk appetite has fed through into sterling. The pound found additional encouragement from a survey indicating a rise in private business confidence. However, a warning from the BRC in this morning’s press highlighted that risk that while pre-Christmas figures were good that consumer confidence could dip in 2010. The Dec BRC survey is due tonight. EUR/GBP has pushed back below the 0.9000 level allowing cable to climb back towards USD1.6180.

EUR/CHF surged higher early in the London session following a warning from SNB President Hildebrand that it would continue to act to prevent “excessive appreciation” of the CHF. The return to economic growth in Q3 in Switzerland has increased speculation that EUR/CHF will be allowed to weaken in the coming months. The CHF has appreciated by 2.4% since mid Dec vs the EUR, but clearly the pace of the appreciation is of concern to the SNB.

Source: forex.com

Someone wanting to make money fast and easy really has few alternatives in a harsh economy like this but if you do have a few dollars to work with, it is possible to earn a considerable amount of cash in a short amount of time. What might work best for you depends on your background, whether you have good market sense, or perhaps you are a little bit tech savvy, or you just plain old have a little bit of moxie in you.

Whatever your skill set, you have to really pick one strategy and go for it if you intend to make your fortune. Let’s talk about one of the possible alternatives for a moment, forex trading. I choose to talk about this one because it is the least complicated, requires the fewest skills, and takes only a modest amount of capital to start up. It is also not a great way to make money fast and easy but it also is the most consistent of the fast money making schemes. Another great plus to this choice is anyone who can scrounge up a hundred bucks can start trading in the forex market. True, it is better if you’re starting with a thousand dollars or ten thousand, but even a hundred or five hundred is enough to begin if you have the right tools.

In order to make money fast and easy trading forex you need three things: a forex trading account, a forex trading software program, and the aforementioned few hundred dollars. Once you have these in place if is only a matter of setting up your account, getting your software to interact with your account, and putting your money in your forex account. At that point you turn on the trading program and stand out of the way.

I talk about using forex software to make money fast and easy in my blog and if I were starting out today with no money, I would certainly go for the easy money in the forex market. My second choice would be to trade binary options and digital options trading, because there is no faster way to make money than the hourly turnover in the binary option market. The returns are less certain than in the forex market, but man the money can turnover really fast. If speed is your concern – go with the binary options and digital options trading, because nothing is faster. If you have time and want consistent returns, go with the forex. If you’re not certain… go with the forex – those trading software programs are hot. Either way, neither of these money makers require much start up capital – even as little as $100 will get you started.

You can make a high return of up to 75% on your investment in one hour using binary option, or digital option, platforms. These trading platforms are easy to use and have fixed returns and losses, making them a safe way to earn a high return from trading on the stock market, currencies and commodities trading. While option trading is a well known practice in the forex market, binary option platforms have streamlined the process and opened it up to the public to trade on and make high, fast returns.

edit Steps

1.
1
Find a high return binary option platform. Since binary option platforms have only been available for the past year, it’s easy to review the platforms in the industry and find the best ones. All platforms should be free and provide traders with the option to withdraw their money at any time.
2.

Register with the binary option platform of your choice.
3.

Pick an option to bid on. You can choose from stocks, commodities and currencies.
4.

Predict which direction the option will move by the time of expiration. The time of expiration can range from one hour to one month, depending on the platform.
5.

Determine which direction the option will move. If you think that the option price will rise above it’s current price by the time of expiration you will need to select “CALL”. If you think that the option will fall below it’s current price by the time of expiration you will need to select “PUT”.
6.

Determine how much money you want to bet on your trade. Since binary option platforms have fixed returns and fixed losses, you will always know how much money you can gain and how much you can loose. The amount that you trade is up to you, but the industry average ranges from $500 – 1000.
7.

Wait for the expiration. When your option has expired, you will be able to see if you are “in the money” or “out of the money”. Traders who are “in the money” can earn up to 75% return on their investment. Traders who are out of the money can loose 85 – 95%.
Tips

* The best way to make a high return is to trade on options that expire within one hour. This way you minimize your risk and have a better chance of forecasting correctly. If you want to make a high return on your investment within one hour, pick an option that will expire within one hour and bid close to the expiration time.
* In order to hone your forecasting skills, read the news daily and keep track of current events. Follow finance news sites like Google News, Yahoo Finance and other notable news sources. Also pick a few niche blogs about binary option trading.

The Best Way To Trade The Forex Market Using binary options and digital options trading
PostDateIcon November 20th, 2009

It is no secret that the forex market could be a terribly profitable place to be if you would like to make money by trading currencies.

However , it’s also no secret that achieving consistency in the foreign exchange market needs plenty of preparation ( you want education and trustworthy trading tools ) because not only you have to have a great idea of where the price is getting ready to move, but also how far it is going to go.

as an example if you’re trading the EUR / dollars pair and you decide it’s a sensible idea to go long, you would place a “buy” order, as you predict the cost of the Euro Buck against the buck to go up.

If you placed your trade using 1 mini lot ( this equals $1 profit for every pip ), and your target for that trade is 30 pips, you would need to have at least $1,000 in your account to meet margin requirements and permit some room for drawdown, and if the trade is successful you will make $30 in profits.

However, in order for this to happen the cost of the EU Dollar has to move 30 pips against the buck, otherwise you won’t reach the planned target and realize the profits. As you can see, if you trade the currency market using the standard approach you’ll have not only to forecast where the price is going, but also how far it is going, which simply makes it twice as difficult.

Now, if you have $1,000 in a binary options and digital options trading trading account, what would you want in order to place a successful trade, and likewise, what sort of profits a successful trade would deliver for you?

In order to answer this question, let us say that the cost of the EUR / $ is at 1.47849 and based a given analysis of the market ( e.g. Swing trading pattern recognition ) you think the Euro Buck is trending up against the Dollar. You can see an example of a real case study of financial software for forex trading hitting a rolling stop-loss here.

In this case you would go long also but instead of placing a “buy” order for currency, you would simply buy a $100 call option for the EUR / greenbacks pair with an one hour expiration. If you are right and the price goes up, even if it’s only 0.001 pip above the price you bought your call option ( which is the strike price ), and it is still there or above till expiration, you would get as much as 75% return on your $100 investment.

In other words, a single $100 trade could deliver $75 in profits and you might repeat this process numerous times during the day.

But the remarkable thing here is that you did not need the price to go up thirty pips in 1 hour to get a 75% return on your investment, you only required 0.001 points of change to reach this.

In this eventuality you certainly had to figure out in what direction the price was going to move ( this is generally an ingredient of the trading process ) BUT your forecast did not have to take you all the way to a 30 pips increase in the price in order for you to make get the anticipated return, because you got it with just 0.001 points of adaptation, and you made $75 rather than $30.

Also, you can open a binary options and digital options trading account with only $100 and you can trade with as little as $30 with no commissions charges.

So as you can see, the potential of foreign exchange trading through binary options and digital options trading is giant and the method is far faster so increasing your possibilities for moneymaking trades {, however ,} you do need to have a sense of where the market is going. Provided that you have this, you are probably going to make take much more winning trades than losing ones and a ton more money also.

If you’re new to binary options and digital options trading you can read more currency trading tutorials here that will teach you the easy way to meticulously find the direction in the cost of any asset, currency or index, so enabling you to be profitable in your trading.

Early Christmas Gifts For Google (GOOG) Employees

Google (NASDAQ: GOOG) which has a tradition of giving holiday presents to its employees gave an early gift this time. Google allowed all its employees to swap their stock options for new ones in March this year.

Google shares had fallen from a high of $740 in late 2007 to around $300 early this year, which meant that 85% of its employees held options that were under water. In order to retain employees, Google had decided to swap the old stock options with new ones with a strike price of $308.57.

Since then, Google shares have been on an upswing. On Thursday, Google shares were trading at $617 which is more than twice the value of early March. The potential gain for Google employees are huge if the stock prices stay at this level and the options are exercised with an average gain of $117,000 for each of Google’s roughly 20,000 employees.

Holiday Sales Push Stocks Higher
News at a Glance

* Lift at open: Stocks slightly higher on light volume
* Retailer cheer: Data show boost in holiday spending
* Kindle on the rise: The electronic reader boosts Amazon
* Bank update: RBS preps for asset sales

The Lowdown

Retailers helped to lift stocks early Monday on optimism for holiday sales.
Click here to find out more!

By 12:30 p.m., the Dow Jones Industrial Average had risen 14 points to 10,534. The S&P 500 had added 1 point, to 1127, the Nasdaq tacked on 5 points, to 2291.

Stocks showed modest upside on light trading as investors eyed the end of the year with retailers helping to support broader gains. Macys (M: 17.95*, +0.38, +2.16%), JC Penny (JCP: 27.42*, +0.40, +1.48%), Nordstrom (JWN: 37.97*, +0.60, +1.60%) and WalMart (WMT: 53.73*, +0.13, +0.24%) were all trading higher early Monday.

Those advances come as MasterCard Advisors’ SpendingPulse showed retail sales rose 3.6% from Nov. 1 through Christmas Eve, vs. a 2.3% decline a year prior.

Amazon (AMZN: 140.89*, +2.42, +1.74%) was also more than 2% higher in early trading after reporting that the Kindle has become the most-gifted item in the online retailer’s history. On Christmas day customers purchased more Kindle books than physical books for the first time ever, the retailer said.

While retailers were higher, airlines were feeling pressure, with Delta (DAL: 11.22*, -0.55, -4.67%) shares falling more than 4% after a man on a watch list boarded a Delta-owned Northwest flight from Amsterdam to Detroit with an explosive hidden on his body and attempted to set off the device before being stopped by other passengers on Christmas Day.

Also weighing on the airlines, winter storms battered the Midwest over the holiday weekend, a week after the Northeast experienced a string of winter-weather related delays.

The economic calendar is light for Monday, but will pick up on Tuesday with consumer confidence and housing data.

Commodities were mixed with crude oil adding 74 cents to $78.79 a barrel and gold edging down a penny, to $1,104 an ounce.

Crude Oil Future Rise to $79

Oil rises near $79 mark on economic optimism, dollar
Natural gas stands out as futures rally 5%

Crude-oil futures rose Monday for a fourth straight session, their winning streak now the longest since October, as an upbeat report on U.S. holiday sales lifted views of the economy and energy demand.

Crude for February delivery rose 89 cents, or 1.1%, to $78.94 a barrel on the New York Mercantile Exchange. Futures ended last week’s trading up nearly 5%.

Retail sales for the holiday season rose 3.6% from the year earlier period through Christmas Eve, according to a report from MasterCard Inc.’s SpendingPulse unit. Other reports this week are expected to show an improvement in U.S. consumer confidence. Read more on holiday sales.

Also helping crude, the dollar stayed lower against most major currencies, boosting dollar-denominated commodities prices as the dollar index /quotes/comstock/11j!i:dxy0 (DXY 77.61, -0.08, -0.10%) fell 0.4% to 77.556. U.S. stocks tallied mild gains, extending their recent run to higher ground.

“A stronger equity market and a positive carryover effect from last week’s economic data are helping energy prices,” said Brian Niemiec, analyst at Susquehanna Financial Group.

“Continued violence across Iran may also be aiding crude as protesters clashed with security forces across the nation.”

By most measures, U.S. consumers’ confidence is slowly improving, although it remains far below normal levels.

Economists surveyed by MarketWatch are forecasting an increase to 54 in December from November’s 49.5 when the Conference Board releases its index of consumer confidence on Tuesday. See Economic Review.

The Labor Department reported last Thursday that initial U.S. jobless claims dropped more than expected, helping push crude up to the highest level in three weeks before financial markets closed for the long Christmas weekend.

In Iran, hundreds of thousands of people opposed to the current Iranian regime took to the streets Sunday in a reprise of the protests that followed the country’s elections in June. Iranian state television on Monday said that at least 15 people were killed.

In other energy trading, January gasoline rose 1.6% to $2.0215 a gallon and January heating oil gained 1.8% to $2.0725 a gallon. The big winer was January natural gas, which rallied 5% to $5.924 per million British thermal units.

The United States Oil Fund /quotes/comstock/13*!uso/quotes/nls/uso (USO 38.94, +0.74, +1.94%) advanced 1.9%, and the United States Natural Gas Fund /quotes/comstock/13*!ung/quotes/nls/ung (UNG 10.77, +0.45, +4.36%) gained 4.6%

Source: Market Watch

Apple(AAPL) Keep rising to $260
Select calls: AAPL, NANO, ASEI
I´m going to give you a quick overview of today´s calls:

- Apple (NASDAQ:AAPL) is likely on the move today again as Thomas Weisel is raising their price target to $250 (from $245) on checks that are pointing to above-expectations iPhone & iMac sales. Broadpoint.Amtech is raising their price target to $260 noting their iPhone sales estimates are 30% above consensus for Dec 09.

Notablecalls: The stock is just begging for a reason to move higher. Wants new highs. Wants $212+ today.

- Nanometrics (NASDAQ:NANO) price target is raised to $17 (from $13) at Piper Jaffray this morning as they believe that there is upside to their estimates as more chip makers increase spending and NANO introduces a new overlay tool. Moreover, the firm believes that it is in leading chip makers’ best interests to broaden their supplier bases and NANO is a prime beneficiary of this effort.

Notablecalls: NANO seems to be one the sexiest Semi Equipment names out there. I suspect the bump from PJCO will create enough buy intrest to propel the shares to $12+ today. I would not rule out $12.50 level today if the market plays ball.

- American Science & Engineering (NASDAQ:ASEI) will be on the move today for sure as Stifel noted that on December 24, the U.S. Army posted a notice indicating that it intends to negotiate solely (as prescribed in FAR 6.302-1, which states policies and procedures, and identifies the statutory authorities, for contracting without providing for full and open competition) with AS&E to provide thirty-seven Z-Backscatter Military Trailers (ZBMTs) to meet’ requirements in Afghanistan. The notice was not a request for competitive proposals as AS&E is considered to be the only source for the equipment. Stifel thinks the order is worth more than $1 million per unit.

Unfortunately, recent events have shown that acts of terror are still being attempted and that, globally, current passenger screening procedures are inadequate to stop such threats. On Christmas day, a passenger on an international flight inbound to a destination in the United States attempted to detonate an explosive device. The components of the device made it past the typical walk-through metal detector and x-ray parcel screener. Stifel thinks (along with many air travel security experts quoted over the weekend) that whole-body imagers and reduced size CT x-ray automated explosive detection systems could provide the solution. AS&E’s SmartCheck and Analogic’s eXaminer SX are among a handful of products that are capable of detecting the materials that were carried aboard and assembled during the flight. Orders for competitors’ equipment are currently being filled, but the firm thinks the recent attempt could accelerate purchases of the equipment. AS&E (ASEI – $71.70) is rated Buy and Analogic (ALOG – $36.20) is rated Hold. They think both stocks are likely to rise today.

Notablecalls: A $40-50mln contract and a juicy terrorist scare in just one weekend. All of a sudden homeland security is hot hot hot again. I think ASEI can trade up 3+ pts on this.

No clue on ALOG. Too thin.

Trade on Apple Stock Option with Binary Options Trading

Apple(AAPL Quote) shares continued to rise in early trading Monday after reaching a record high Thursday. The stock’s surge is due to speculation that in January, Apple will launch a major product, presumably its highly anticipated tablet computer.

By mid-morning, Apple’s stock hit $212.92, up nearly 2% over Thursday’s closing price of $209.04.

On Wednesday, the Financial Times reported that Apple rented space for several days next month at an arts center in San Francisco, possibly signaling that the Cupertino, Calif., electronics company is preparing for a big announcement. While Apple hasn’t officially confirmed plans for a tablet, the anticipation of an iPad has captivated the imagination of enthusiasts and sparked debates among fans and investors for more than a year, as they eagerly await a new blockbuster Apple device.

With the Amazon (AMZN Quote) Kindle in its sights, Apple is believed to be preparing to start production of a 10-inch touchscreen e-book with the first model expected to arrive as early as March, Oppenheimer analyst Yair Reiner said earlier this month, citing information from suppliers. The report confirmed earlier rumors that suppliers were gearing up for a February kickoff of the Apple tablet.

Apple, known for its grandiose product launches, is also well-known for closely guarding plans and announcements of its new tech tools. Rumors continue to swirl around the tablet’s official name; last week, Apple watchdog MacRumors.com reported that Apple had acquired domain name iSlate.com, while BusinessWeek noted that Apple controls the trademark name TabletMac, which it took over from company Axiotron in November 2008.

European stocks climbed

European stocks climbed to the highest level since October 2008 and Asian shares advanced after China raised its economic growth forecast and Japan’s industrial production increased. U.S. index futures also gained.

Infineon Technologies AG, which gets more than 40 percent of annual sales from the Asia-Pacific region, added 1.1 percent. ArcelorMittal led basic-resources companies higher as metals prices rose. Seadrill Ltd., the drilling company founded by billionaire John Fredriksen, and Aker Solutions ASA gained at least 1 percent as crude oil traded above $78 a barrel.

Europe’s Dow Jones Stoxx 600 Index added 0.4 percent to 252.89 as of 12:46 p.m. in Paris. The gauge is heading for its biggest annual increase in a decade, having climbed 27 percent this year, on mounting evidence that the global economy is recovering from its worst recession since World War II. Markets in Europe were closed on Dec. 25 for the Christmas holiday. The U.K. is also closed today.

China on Dec. 25 raised its 2008 growth estimate to 9.6 percent from 9 percent and said this year’s quarterly figures will also increase, narrowing the gap with Japan, the world’s second-biggest economy.

Emerging markets’ economies “will support global growth,” said Arnaud Scarpaci, a fund manager at Agilis Gestion in Paris, which oversees about $150 million. “That’s good for stocks. We expect another year of gains in 2010.”

Rally Since March

Japan’s Cabinet Office said on Dec. 25 that the economy will expand for the first time in three years and today said industrial production improved for a ninth month in November.

A 60 percent rally in the Stoxx 600 since March has been spurred by record-low interest rates in the U.S. and Europe and as governments committed about $12 trillion worldwide to revive credit markets and stimulate economic growth.

U.S. stocks rose last week, pushing the Standard & Poor’s 500 Index to a 15-month high. Futures on the benchmark for U.S. equities increased 0.1 percent today, and the MSCI Asia Pacific Index advanced 0.7 percent.

Infineon, Europe’s second-biggest semiconductor maker, climbed 1.1 percent to 3.83 euros.

ArcelorMittal, the world’s biggest steelmaker, rose 1.5 percent to 31.77 euros. Boliden AB, Europe’s second-largest zinc producer, gained 1.3 percent to 91.05 kronor.

Basic-resources shares were the best performers among 19 industry groups in the Stoxx 600. Copper in Shanghai climbed to the highest price in more than 15 months on optimism demand is improving in the world’s largest user after domestic stockpiles dropped. Zinc jumped to the highest since April 2008.

Crude Oil

Seadrill rose 1.1 percent to 149.1 kroner. Aker Solutions, Norway’s biggest maker of oil platforms and equipment, advanced 1 percent to 76.15 kroner. Tenaris SA, the world’s largest maker of seamless pipes used to extract oil and gas, added 1.8 percent to 15.04 euros. Crude oil climbed for a fourth day as forecasts of colder-than-normal weather in the U.S. increased demand for heating fuels.

PSA Peugeot Citroen, Europe’s second-biggest carmaker, added 0.9 percent to 23.67 euros. French new car sales increased by about 40 percent between Dec. 1 and Dec. 23, helped by scrapping incentives, French daily Les Echos reported, without citing anyone. By Christmas, December car sales in France reached 180,000, meaning that 2009 as a whole will show an increase of about 9 percent, according to the newspaper.

Seat Pagine Gialle SpA lost 2.2 percent to 16 cents after Italy’s largest telephone directories publisher said on Dec. 23 that it may cut financial targets for 2010 and 2011.

U.S. Economy

The U.S. economy next year will turn in its best performance since 2004 as spending perks up and companies increase investment and hiring, says Dean Maki, the most- accurate forecaster in a Bloomberg News survey.

The world’s largest economy will expand 3.5 percent in 2010, according to Maki, the chief U.S. economist at Barclays Capital Inc. in New York. The rebound in stocks and rising incomes will prompt Americans to do what they do best –consume, said Maki, a former economist at the Federal Reserve.

Brown-Forman Corp.’s Paul Varga and Johnson & Johnson’s William Weldon are among chief executive officers left behind in the 2009 stock-market rebound even after they created the most value for their companies. Brown-Forman, the maker of Jack Daniel’s whiskey and Southern Comfort liqueur; J&J, the world’s largest health products company; and 30 other S&P 500 companies rallied less than 10 percent this year as their managers posted better-than-average sales and efficiently invested capital, data compiled by Bloomberg show.

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GBP-USD: Headed Toward 1.5706

GBP-USD: As the pair continues to extend its declines initiated from its Nov. 16 low at 1.6875, we expect further downside toward the 1.5706 level, the Oct. 13 low.

Click here to view a chart of the currency pair.

A breach will see a 100% price retracement (from 1.5706-1.6875 levels) and open the door for additional downside toward its .50 Ret (1.3501-1.7041 rally) at 1.5273.

The pair’s daily relative strength index is bearish and pointing lower, suggesting further downside.

Conversely, immediate resistance lies at the 1.6000 level, but the pair must trade above its Nov. 25 high at 1.6744 and its Nov. 16 high at 1.6875 to reverse its current downside threats and bring further gains toward the year-to-date high at 1.7041. There, a decisive invalidation will resume its medium-term uptrend toward its .50 Ret (2.1160-1.3501 decline) at 1.7314.

Overall, GBP-USD remains vulnerable to the downside, with the next key support level at 1.5706.

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Stock market will tread water in 2010

Trading On Stock Market at 2010

If your faith in the stock market remained unshakable in 2009, toast your own good sense. It was a great comeback year, with the leading indexes up 20 percent to 45 percent. Most stocks are up about 50 percent from the year’s lows in March.

But don’t expect anything like a repeat in 2010.

A bull statue near the New York Stock Exchange may not symbolize how the market will fare in 2010.

Look for stocks to show little upside oomph over the next 12 months. A decline is possible, but a tight trading range is more likely. When stocks don’t show any direction, it’s usually because of confusion, something we’ll see plenty of in 2010. Investors will be preoccupied with measuring the conviction of any recovery, but the signals won’t be clear.

We will, indeed, see an improving economy in 2010. Production will ramp up. Hiring will grow. But it won’t look like the kind of recovery people are accustomed to.

For one thing, bank lending will remain tight. All of the incentives for banks are still on the side of retracting from risk and strengthening their balance sheets. Also, many are saddled with bad commercial real estate loans that will become bigger problems over the next couple of years. Commercial property values — now at a seven-year low — will drop more and could hit a total decline of about 50 percent from the decade’s highs, according to Foresight Analytics.

The other disappointment for people will be housing prices. Many equate an increase in home values with true prosperity, and government support for home-buying shows the industry’s populist importance. But tax credits have to end as the government turns its attention to deficits, and mortgage rates can’t fall any further.

The housing market is a ball of bad debts that will take years to unravel. It depended since the 1990s on people cashing in equity to trade up. But now there is no equity, and the pressure will be felt on higher-end homes. The Cook County assessor’s office is reporting that foreclosures in well-to-do neighborhoods are rising faster than in lower-income neighborhoods, where subprime mortgages were the culprits. Research from Barclays Capital and others say that over the next three years, the market will face a surge of adjustable-rate loans scheduled to reset at higher rates, increasing many people’s payments 50 percent or more.

STEP ON IT: Robert W. Baird & Co. analyst David Leiker suggests keeping an eye on Navistar International (NAV), which last traded at $40.62. Leiker wrote that if the stock slips, and especially if it gets back to recent values of around $35, it will pose a compelling opportunity. Leiker says several trends work in Navistar’s favor, starting with a cyclical recovery in commercial vehicle sales.

He also sees the company reporting higher profit margins on cost-cutting and on its decision to take engine manufacturing in-house.

Note that one of NAV’s businesses is manufacturing chassis for motor homes. And motor-home production is starting to pick up, though for the life of me I can’t understand why.

UNDER IT ALL: Which brands are causing a buzz these days? For people under 25, Under Armour (UA) has to be on that list. The maker of moisture-wicking sports apparel has identified itself with the youth market and appears ready for worldwide growth, reports Sharon Zackfia, analyst at William Blair & Co.

Zackfia wrote that Under Armour has the potential to quadruple its U.S. market share, currently at around 2 percent. The company relies less on international sales than Nike (NKE), but even there the sales growth will be in the billions of dollars if it merely maintains its current rate of increases, she said.

PERFECT PERFIDY? The New York Times reports that the Securities and Exchange Commission and the security industry’s in-house cop, the Financial Industry Regulatory Authority, are looking at whether Goldman Sachs Group (GS) and other big banks deliberately steered customers into bad investments on collateralized mortgages. While the banks were selling these securities, they also were taking positions that helped them profit from a decline in housing values. This may have been going on in 2007, when the housing markets first showed cracks.

The allegation sounds damnable, but it’s really just an extension of what Wall Street does. They trade and hedge regardless of customer interests. These are nonpartisan profit-mongers. They can even say taking the opposite side of the trade was prudent business.

The old saying in Washington is that if you want a friend, buy a dog. If you want a friend on Wall Street or LaSalle Street, feed a pigeon.

DATA MINING: A company that operates from Lake View, Ycharts, has a free online service for stock analysis. A founder, Shawn Carpenter, said investors have little choice if they want free or low-cost data services that measure a stock’s long-term financial performance and enable comparisons with other companies. Ycharts takes financial reports and puts them into easy-to-read graphics. The service relies on advertising for revenue. It’s just starting, and it links to other sites for some data analysis. But Ycharts is looking for feedback. It’s worth checking out if you can’t afford a Bloomberg terminal.

CLOSING QUOTE: “Apple [AAPL] may be on the verge of kneecapping the cable industry.” — a headline at seekingalpha.com on a piece about Apple negotiating with TV networks to offer subscription access over the Web.

If you’ve ever waited all day for the cable guy or been stuck in cable’s on-hold limbo, you’re probably rooting for Apple to the core.

Resource: http://www.suntimes.com