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The Core Concept of the US Dollar Exchange Rate
The US dollar exchange rate essentially reflects the conversion ratio between the dollar and other currencies. For example, when the EUR/USD value is 1.04, it means that 1.04 US dollars are needed to exchange for 1 euro. When this value rises to 1.09, it indicates that the euro has appreciated and the dollar has depreciated; conversely, a drop to 0.88 signifies the euro's depreciation and the dollar's appreciation.
The US Dollar Index is a weighted composite of the exchange rates of the dollar against six major currencies: the euro, Japanese yen, British pound, Canadian dollar, Swedish krona, and Swiss franc. The index's level visually reflects the strength or weakness of the dollar relative to these currencies. It is important to note that the Federal Reserve's interest rate cut policy does not necessarily lead to a decline in the dollar index; it also depends on whether the countries of the index's component currencies have taken supporting measures.
The Historical Cycles of the US Dollar Movement
Since the collapse of the Bretton Woods system in 1971, the US dollar index has experienced eight complete phases of rise and fall.

The Spread Is the Truth of Trading Costs
When you open your forex trading software, you'll see two prices — the bid and the ask. The seemingly insignificant difference between these two is the spread, which is also the most direct source of income for brokers.
In simple terms, brokers sell to you at a higher price and buy back your position at a lower price. The difference between these prices is your trading cost. For example, if the EUR/USD ask price is 1.1234 and the bid price is 1.1236, the difference is 2 units — which is 2 pips.
What exactly is a Pip? Why is it important to understand?
A pip (point) is the smallest change in the price quote in the forex market. For most currency pairs, one pip equals a change of 0.0001 in the fourth decimal place.
For example, if EUR/USD rises from 1.1234 to 1.1235, it has increased by 1 pip. It may seem tiny, but because forex trading uses leverage, this small change

Why do we need index futures?
In the world of investing, choosing the right investment target is often the most headache-inducing task. The true operational status of a single stock is like looking at flowers in the fog for investors. Therefore, the financial market has introduced the clever innovation of "indices." Indices help investors quickly grasp the overall trend of industries, countries, or even asset classes by combining multiple underlying assets. A basket of stocks can form an index, a group of bonds can form an index, and even a set of currencies can be compiled into an index.
However, indices themselves are not physical commodities and cannot be bought or sold directly. To solve this problem, the global index futures market emerged. Investors can participate in the price fluctuations of various indices through financial derivatives called index futures. The prices of index futures perfectly track the performance of their corresponding indices, allowing institutions and retail investors to flexibly use leverage tools for hedging or speculation.
Understanding the essence of index futures
Index futures (Ind

Why Are Traders Using Fibonacci?
If you've been active in the forex market, you've definitely heard of Fibonacci. This technical analysis method, originating from 13th-century Italian mathematician Leonardo Pisano (nicknamed Fibonacci), has remained popular in financial markets for a reason—there's a fascinating mathematical secret behind it: the golden ratio.
Simply put, the golden ratio is a "harmonious proportion" that repeatedly appears in nature and markets. From the galaxies in the universe to human facial features, from petal arrangements to stock market trends, this ratio is everywhere. Traders leverage this by turning mathematical patterns into trading signals.
What is the mystery behind the Fibonacci sequence?
The Fibonacci sequence is quite simple: each number is the sum of the two preceding ones.
0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55

The foreign exchange market is the largest financial market in the world, with a daily trading volume of $6.6 trillion, primarily driven by speculative activities. The market operates 24 hours a day, allowing participants to trade across different financial centers. Although only a small portion of trades are driven by actual demand, the market liquidity is extremely high.

Why does the market need short selling?
The essence of the market is a battle between bulls and bears. If investors can only "buy long" to make money, then the entire market will face serious structural imbalances—raging upward during rallies and crashing rapidly during declines. Historical data proves that markets with short selling mechanisms are more stable in their volatility, and their price discovery mechanisms are also more refined.
Conversely, if the market provides both long and short profit opportunities, investors can profit whether in a bull or bear market. This significantly increases market participation and overall liquidity. That is why mature global capital markets have well-established short selling mechanisms.
Core Concept of Short Selling
The definition of short selling (shorting) is simple: when you predict that an asset will decline in the future, you sell the asset you do not own at the current price, then buy it back after the price drops to return it, earning the difference. This is completely opposite to the logic of "going long"—going long is to buy first and then

The market today presents a diversified upward trend. Amid escalating geopolitical risks and ongoing tightness in global supply chains, precious metals collectively strengthen. Gold broke through the $4,500/oz mark, reaching a high of $4,525; silver also performed well, rising to $72.65/oz; platinum was not to be outdone, hitting a new high of $2,378/oz. The simultaneous rise of these three reflects investors' continued pursuit of safe-haven assets.
In the commodities market, London copper prices continued their strength, breaking through the $12,000 mark and continuing to rise, with the latest quote at $12,213, up 0.96%. Traders pointed out that the driving forces behind the rise in copper prices come from two directions: on one hand, tariff expectations have prompted traders to accelerate importing copper into the US, leading to increased global competition; on the other hand, mines in the Americas, Africa, and Asia are experiencing phased shutdowns, resulting in a significant supply shortage.
In the foreign exchange market, the AUD/USD has continued for the third consecutive

The Chinese Renminbi recently made a big move—both the USD to RMB exchange rate and the offshore USD to RMB rate hit new lows. On December 25th, the offshore USD to RMB fell to 6.9965, the lowest since September 2024; the onshore USD to RMB even dropped to 7.0051, a historic low since May 2023. In simple terms, the RMB has firmly crossed the 7 threshold.
Why did the RMB suddenly appreciate? Three forces are resonating
This round of appreciation is no coincidence; three forces are simultaneously exerting influence.
First, the US dollar itself has weakened. The Federal Reserve's rate cuts and the rise of de-dollarization trends have directly caused the US dollar index to fall over 10% this year, with a 2% decline in the past month. With the dollar losing strength, the RMB naturally appears more robust.
Second, the People's Bank of China (PBOC) is intentionally guiding the appreciation. This year, the PBOC has continuously raised the midpoint (reference rate) of the USD to RMB exchange rate, signaling clearly: our central bank is determined to let the RMB appreciate.

December 19, Japan's central bank announced a 25 basis point rate hike, raising the policy interest rate to 0.75%, the highest level since 1995. However, the market's reaction was unexpected—the USD/JPY exchange rate actually strengthened, and the yen did not receive the support as anticipated. The reasons behind this phenomenon warrant in-depth exploration.
The rate hike signal was not clear enough, and the market interpreted it as "dovish."
Bank of Japan Governor Haruhiko Kuroda did not provide the firm stance investors expected during the press conference. He admitted it is difficult to determine the neutral interest rate level in advance (currently estimated to be in the range of 1.0% to 2.5%) and stated that this estimate could be revised if possible. This ambiguity in the statement led to uncertainty about the future pace of rate hikes.
According to market expectations indicated by overnight index swaps (OIS), the Bank of Japan may not raise rates to 1.00% until the third quarter of 2026 at the earliest. Nomura Securities pointed out that only when the central bank...

There are a bunch of technical indicators in stock market software, which can be overwhelming for beginners. But if you want to get started quickly, the Stochastic Oscillator (KD Indicator) is definitely worth learning first. Why? Because it can help you solve three core problems:
- When to buy, when to sell
- When the price will reverse
- Whether the market is overbought or oversold
What exactly is the KD Indicator?
The KD Indicator, officially called the "Stochastic Oscillator," was proposed by American analyst George Lane in the 1950s. Its core logic is simple: it uses a value range from 0 to 100 to record the relative strength or weakness of a stock price within a specific period.
The indicator consists of two lines:
- K line (fast line): reacts quickly to price changes and is the main axis of the indicator
- D line (slow line): a smoothed version of the K line, reacts more slowly
The interaction between these two lines is what you

Why should Taiwanese investors keep an eye on the US PCE?
Want to understand why the Taiwan stock market and exchange rates fluctuate? The answer might be in Americans' wallets.
The US PCE index (Personal Consumption Expenditures Price Index), although it sounds unfamiliar, directly influences the dollar's appreciation or depreciation, the rise and fall of US stocks, and subsequently impacts Taiwan's exports, stock market, and exchange rates. As the world's largest economic engine, any change in US consumer data can create ripples, with Taiwan, an export-oriented economy, feeling the effects first.
Simply put: The PCE index reflects changes in Americans' spending on food, clothing, housing, transportation, healthcare, and other categories. An increase indicates robust consumption, while a decrease suggests weak spending. The Federal Reserve considers it the most important inflation indicator, and investors see it as a barometer for predicting economic trends.
How is the PCE index calculated? Three steps to understand the calculation logic
The calculation of PCE may seem complex, but it actually involves three core steps:
Step one: Comprehensive collection of price data

Last week, the US dollar index rose, while non-US currencies showed divergence, with the euro and yen both declining. The European Central Bank maintained its policy stance, and the Federal Reserve's rate cut expectations were adjusted. The Bank of Japan raised interest rates but maintained a dovish stance, leading to a depreciation of the yen, with increased risk of government intervention. Attention should be paid to US GDP, geopolitical risks, and the yen policy direction.

Why Should You Pay Attention to the US Dollar Index?
In the international financial markets, headlines like "US Dollar Index Rises Again" or "US Dollar Weakens" appear frequently. But do you truly understand what they mean? Whether you're trading forex, investing in US stocks, or simply holding Taiwanese dollar assets, fluctuations in the US Dollar Index will directly or indirectly impact your investment returns. It acts like a barometer of the global economy, telling us through numbers whether the US dollar is strong or weak relative to other major currencies.
Core Definition of the US Dollar Index
The US Dollar Index (abbreviated as USDX or DXY) is not a specific asset but a relative measurement indicator. Just as a stock market index tracks the overall performance of multiple stocks, the US Dollar Index measures the exchange rate changes of the US dollar against six major international currencies.
These six currencies are:
- Euro (EUR) — the largest component, approximately 57.6%
- Japanese Yen (JPY) — about 13.6%

Things to Know Before Exchanging Japanese Yen
Many people think that exchanging foreign currency is just a matter of going to the bank once, but in fact, a small difference in the exchange rate can mean the cost of a few cups of bubble tea. By December 2025, the NT dollar to Japanese Yen exchange rate has reached 4.85, up about 8.7% from 4.46 at the beginning of the year. For investors looking to position in Yen, this presents a good entry opportunity.
But before you start exchanging, you need to clarify a few questions:
- What is the difference between cash exchange rate and spot exchange rate? The cash exchange rate is the price offered by banks for physical cash transactions, usually 1-2% higher than the international spot rate; the spot rate is the market price for electronic transfers, settled within two business days, and more closely reflects the true market value.
- Why exchange for Yen? Besides travel, the Yen is one of the world's three major safe-haven currencies (along with the US dollar and Swiss franc). For Taiwanese investors, exchanging for Yen can hedge against Taiwan stock market fluctuations and counteract the pressure of NT dollar depreciation.

MediaTek (2454) recently stabilized after a decline, but the stock price has been oscillating within the 1,380 to 1,460 TWD range for a long time. End-of-year institutional accounting, market adjustments, and concerns over mobile phone inventory have become short-term suppressing factors. The current P/E ratio is 20.74, which already carries a premium compared to pure mobile chip stocks, but still has room to rise compared to high-end ASIC peers.
However, a recent major strategic partnership could become a turning point that changes market expectations. MediaTek announced a collaboration with DENSO, a global leader in automotive components, to jointly develop next-generation advanced driver-assistance systems (ADAS) and customized system-on-chips for smart cabins. This not only marks a breakthrough for this CPU concept stock in the automotive field but could also serve as a catalyst to break through the stock's sideways trading range.
Three core advantages of cross-industry collaboration
For a long time, the market has regarded MediaTek as a smartphone chip manufacturer, causing its stock price to fluctuate significantly with the global upgrade cycle.

Stock market high returns are always enticing, and borrowing money to invest—also known as leverage—has become a popular choice for many to get on board quickly. But is borrowing more and more really the best approach? Today, let's discuss this topic.
Why do investors choose to borrow money to buy stocks?
In fact, investors use leverage for a variety of reasons. Some want to quickly capitalize on excellent opportunities, others use it to free up funds to explore other investment directions, and some employ leverage for hedging to reduce risk. But don’t forget, leverage is a double-edged sword; it amplifies gains but also magnifies losses.
The dual nature of borrowing money for stocks: returns and risks
Returns side:
If the cost of borrowed funds is low enough and the stock performance is strong, borrowing to buy stocks can multiply your returns. The stock market often sees short-term explosive gains in certain stocks; capturing these opportunities with leverage can help maximize your profits. Additionally, borrowing to invest can also free up principal for other uses.