FOREX Analysis Exercise & Report: Analyzing and Trading Major Foreign Currencies in the World

Part 1: Individual Market View Report

This is a team FOREX analysis exercise and report developed based on professional practices and in discussion with Forex specialists from Thomson Reuters. Further details for this report are provided below in this course guide. The FOREX Analysis Exercise & Report must be completed in a team. Teams are strictly limited to a minimum of 3 and a maximum of 4 members. A team should aim to have the following strengths: good writing skills, excellent analyst expertise, strong quantitative background and capable researcher. Any changes in team size or formulation must be approved by the local lecturers. Every team is required to submit ONE individual piece and ONE group report on the date to be advised. For this exercise, you are tasked as a member of a Forex dealing team working for a large Singapore bank and trading major foreign currencies in the world. Your senior manager has asked you and your team to analyse and explain the behaviour of three pairs of exchange rates (for a team of three members; a team of four members is required to analyse and explain four pairs of exchange rates). Based on your analysis, your team is required to develop a trading strategy and provide a report. Your team will select from the following currencies: USD, AUD, JPY, GBP, THB and EUR. You will complete this task in two stages. Part 1: Individual Market View Report (20%) Each of you is part of a team and is required to conduct independent research that will feed into your group report. This research consists of outlining and explaining the behavior of a self-selected pair of exchange rates over the past (i.e., your interpretation of historical data). You must exclusively choose from currencies listed above and make sure each team member is studying a different currency pair. The individual part should be a maximum of 700 words in length with a tolerance of + 10%. In this task, you are required to do some research in order to form a view regarding current and future market conditions. Do you think that exchange rates will go up or down in the next 3 to 6 months? Why do you think this? For this, you should first identify the economic factors that influence the foreign exchange rates (review the course materials). Then you should collect and use financial news and news regarding national and international events which are likely to have an impact on the market. For news and market data, you can use any professional data sources such as professional magazines, institutional websites and newspapers. Do not simply quote other people’s opinions. You should present your opinion, and explain in your own words why you hold that opinion in a way that shows that you understand the theory behind the determination of the exchange rates. You can certainly quote evidence that supports your opinion, and this evidence must be correctly referenced (do not submit copies of your collected articles with your report). For your view, you should use at least five references.