France's manufacturing PMI shrank to 41.9 in December, the worst reading in 4-1/5 years, and below estimates of 43.2, while down from 43.1 in November. 

Euro rose in European trade on Monday against the dollar away from recent two-week lows as the hopes grow for a reduction in the eurozone-US interest rate gap.

The Federal Reserve will likely cut interest rates for the third time this year, and will likely provide clues on the pace of interest rate cuts next year.

The Price 

The EUR/USD rose 0.4% to $1.0524, with a session-low at $1.0482.

The pair rose 0.3% on Friday, the first profit in six days away from two-week lows at $1.0453.

Euro lost 0.65% against the dollar last week, the second weekly loss in a row after the fourth ECB interest rate cut in a row.

ECB

The European Central Bank cut interest rates by 25 basis points to 3.15% last week, the lowest since February 2023.

The ECB hinted at the possibility of additional monetary easing at upcoming meetings as inflation continues to cool in the eurozone.

ECB President Christine Lagarde said the decision to cut interest rates for the fourth time this year comes as inflationary pressures receded and economic activities softened. 

She said there were arguments for a 0.5% rate cut, but eventually all settled on a 0.25% rate cut. 

Lagarde added that neutral interest rates will be discussed when they’re approached. 

Following the meeting, the odds of a 0.25% ECB interest rate cut in January rose from 35% to 55%.

Now markets expect the ECB interest rate to decline to 1.75% by the end of 2025. 

The Fed 

The Federal Reserve will hold its periodic policy meeting this week, and is fully expected to cut interest rates by 25 basis points.

Interest Rate Gap

The US-Eurozone interest rate gap rose to 160 basis points this week, but could shrink once more this week with the Fed’s upcoming interest rate cut, in turn underpinning the euro. 

Bitcoin rose on Monday and expanded the gains for a second day, rising above $106,000 for the first time ever after US President-elect Donald Trump announced plans to build a bitcoin strategic reserve in the US.

The crypto market was further boosted by MicroStrategy, the biggest bitcoin-buying company in the world, after it was listed in the NASDAQ 100 index. 

The Price

Bitcoin rose 2.0% at Bitstamp to $106,533, a record high, with a session-low at $104,269.

On Sunday, bitcoin rallied 3.0%, the second profit in three days on Trump developments.

Bitcoin rallied 3.2% last week, the second weekly profit in a row as positive sentiment gripped the market. 

Crypto Market Value 

The market value of cryptocurrencies rose by $115 billion on Monday to a total of $3.920 trillion, a record high, as both bitcoin and ethereum rallied.

Strategic Reserve 

Last Friday, US President-elect Donald Trump suggested building a US strategic reserve of bitcoins, similar to oil. 

Trump asserted the need not to let China or any other country to supersede the US in the crypto race. 

According to CoinGecko data, world governments currently own 2.2% of total supplies of bitcoin, with the US owning 200,000 bitcoins, amounting to over $20 billion.

China, the US, Bhutan, and Slavador are other countries that hold large reserves of bitcoin.

Bitcoin is up over 55% so far since Trump’s election victory in November, with his administration viewed as highly supportive and flexible with cryptocurrencies. 

And since the start of 2024, bitcoin’s value more than doubled and gained nearly 150% so far, on track for even more gains as the market flares up.

MicroStrategy 

Last Friday, the NASDAQ Exchange announced the listing of MicroStrategy into its NASDAQ 100 index. 

MicroStrategy is known for its aggressive purchases and hoarding of crypto assets, with the company’s share surging by over 6 folds this year, sending its total market value to $94 billion.

Making profits in financial markets requires experience, knowledge, and continuous monitoring, which can be challenging for many. This is where the concept of copy trading (Copy Trades) comes in as an innovative solution. It enables investors to benefit from the skills of professionals and their well-considered decisions, increasing their chances of making a profit. For this reason, copy trading has gained wide popularity among traders who lack experience in trading, as well as those who have limited time to manage their trades. In this article, we will provide a comprehensive review of the concept of copy trading and the best specialized companies in this field.

What is Copy Trading?

We can consider it as a trading tool or method offered by certain platforms, allowing a trader to copy the positions of an expert trader. In simpler terms, when this expert opens or closes a position, it is automatically replicated on the beginner’s or copier’s account without any human intervention. Thus, those without trading experience or enough time to follow the markets moment by moment can make investment decisions directly and automatically based on professionals’ decisions. This system relies on software or platforms that enable such mirroring or copying.

The copy trading style, sometimes called “mirror trading,” emerged in 2005. Initially, traders copied specific algorithms developed through automated trading. Developers shared their trading history, allowing others to replicate their trading strategies.

Generally speaking, copy trading focuses on short-term trading, particularly day trading strategies. Copy trades often concentrate on assets within the Forex market, as well as cryptocurrencies and other complex or volatile markets.

Advantages of Copy Trading:

• Copy trading allows you to diversify your investment portfolio in unfamiliar markets that you wish to trade in due to their strong investment opportunities. By using copy trading, you can access the expertise of another trader or maximize the benefits of seasonal trends that you might not normally consider as potential opportunities.
• Through copy trading, you can make the most of your time by making quick decisions based on the choices of traders who have proven, profitable performance records.
• Investors can reduce risks by following professional traders, helping them benefit from successful strategies and achieve stable returns.
• Copy trading can reduce the stress associated with making investment decisions and enable users to learn professional analysis and investment methods.

Disadvantages of Copy Trading:

• Copy trading may not provide a strong incentive for traders to conduct their own research and learn about the markets.
• Copy trading does not completely eliminate risks. Sometimes professionals use this method to influence market prices for their own financial gain.
• There may be other risks associated with fully relying on others’ performance, such as significant losses if the professional fails to achieve profits. The professional might be able to bear these losses, but the beginner may not.
• This system may require fees or commissions that can affect total profits. Additionally, users should recognize that copying does not eliminate the need to follow the market and understand the fundamentals.

While copy trading can help when you are first getting started, it is not the only available trading strategy. However, the appeal of potential earnings with minimal work may be enough for some people.

How the System Works:

With copy trading, the investor has the option to automatically execute every trade performed by another trader, mirroring their performance in their own account. Therefore, the investor does not place their money in the hands of a fund manager or an expert managing the portfolio (as is the case with common investment methods). Instead, the investor simply opens their own trading account, retains ownership, and then links it to the professional trader’s account (selected based on their stable trading record) through a platform or broker that supports copy trading.

In simpler terms, the funds always remain in the investor’s possession and are not handed over to a third party. Instead, the investor delegates the management of their account to another trader (or multiple traders) to automatically copy their trades.

For copy trading, you need a broker to open a trading account through which you can receive the trade signals from the traders you’ve decided to copy. This is done via the copy trading platform.

Below is a list of the best companies that offer copy trading services, along with the advantages of each:

Pepperstone

• Pepperstone holds licenses from globally recognized regulatory bodies, ensuring the protection of client funds and boosting trust in the company.
• Pepperstone uses MetaTrader 4 and MetaTrader 5, well-known trading platforms that offer advanced technical analysis tools and easy copy trading functionality.
• Pepperstone offers a range of account types to suit different trader profiles, including Islamic accounts.
• Pepperstone is characterized by low trading commissions, making it easier for traders to achieve higher profits.
• They provide 24/7 technical support in multiple languages, making it easier for clients to get help when needed.

XM

• XM offers a variety of account types that allow traders of all levels to choose the account that suits their needs, including standard and micro accounts.
• XM provides comprehensive educational resources, including webinars and interactive lessons, helping new traders improve their skills.
• The company offers popular trading platforms like MetaTrader 4 and MetaTrader 5, giving investors access to various online user forums.
• XM’s Copy Trading feature allows traders to easily replicate successful traders’ strategies.
• XM offers bonuses and promotional campaigns that appeal to new traders, such as deposit offers and incentives for opening new accounts.
• XM provides advanced technical analysis tools to help traders make informed decisions.
• Also, the company holds several important internationally recognized regulatory licenses to ensure the protection of client deposits.

Zulutrade

• The company offers a copy trading option where users can choose traders based on factors like performance and risk.
• Provides a wide range of different strategies that can be copied.
• Offers tools to help you make informed decisions based on performance data.

CopyFX

• The company provides customization options for copy trading, allowing for the setting of desired risk and return levels.
• Supports direct communication and performance analysis of traders.
• Professional traders can earn commissions from investors who copy their trades.

eToro

• The company has extensive experience in social trading, enabling users to interact and share ideas.
• A user-friendly design makes it easy for beginners to get started.
• Offers trading in stocks, Forex, and digital currencies.

AvaTrade

• The company offers a variety of copy trading accounts to meet the needs of investors at different experience levels.
• Provides numerous technical and news analysis tools.
• Offers educational content and courses to enhance your trading knowledge.

In the end, before committing real capital based on another participant’s advice—no matter how professional they may be—you should conduct some of your own analysis, even if you are not familiar with the underlying market. This is especially important if you are unfamiliar with how a particular market operates.