24 Market information on the internet. Use your own institutions currency database or visit http:// www.oanda.com/convert/fxhistory, to
Question:
24 Market information on the internet. Use your own institution’s currency database or visit http://
www.oanda.com/convert/fxhistory, to obtain exchange rate data covering at least one year, copy and paste the results into Excel and answer the following questions:
a Determine the cross exchange rate between the Japanese yen and the Australian dollar. Compare the cross exchange rate with the direct rate. Are there any differences? Evaluate the significance of your results.
b Select a pattern, for example two days of consecutive falls, then select and check the movements on the following day (the third day in this case). Are the following day movements unusual in any way? Evaluate the significance of your results.
It is helpful to use nested ‘if’ instructions in Excel.
In this example two days of consecutive falls is the criteria for selecting the third day’s price movement.
An instruction placed in C4 and copied and pasted to C365 with exchange rates from B1 to B365 would be: ¼IF(B3>B2, IF(B2>B1, B4,‘‘ ’’),‘‘ ’’) a run of three days would be:
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