Now...down to looking at:
EUR/USD
USD/CHF
seeking to expose overbought situations with either pair...they move opposite to one another
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
How many cross rates TOO MANY to watch and trade?
- Thread starter increasenow
- Start date
Now...down to looking at:
EUR/USD
USD/CHF
seeking to expose overbought situations with either pair...they move opposite to one another
I appreciate all your replies. I guess the best trade would be to adopt a short position and it seems it applies to every pair now ending the year. For me it's better to wait and see how implications will be reflected on markets next year. Any thoughts?
Quote from increasenow:
Now...down to looking at:
EUR/USD
USD/CHF
seeking to expose overbought situations with either pair...they move opposite to one another
Hey can you explain what you mean by that? Do you mean trading them against each other (I guess you'd call that pairs trading the pairs lol)?
They display a >90% negative correlation with each other...IOW be careful if you load up too much (for example a full position long eur/usd and a full position short usd/chf) because you can increase your directional risk more than you realize.
It's easy to overweight your positions if you don't take correlation into account.
I am definitely not telling you what you're doing is wrong, I just wanted to give you a heads up as to how you may want to take correlation into account.
http://fxtradeinfocenter.oanda.com/charts_data/fxcorrelations.shtml
Here maybe that will help you.
thanks Reaver...sorry to confuse...actually I am talking about "monitoring 2-3 cross rates" in order to take a "Strategic" trade on one of them solely...I've not really thought about opening up positions on more than one "oppositely correlated" cross rates...have you done that?...anyone?Quote from Reaver:
Hey can you explain what you mean by that? Do you mean trading them against each other (I guess you'd call that pairs trading the pairs lol)?
They display a >90% negative correlation with each other...IOW be careful if you load up too much (for example a full position long eur/usd and a full position short usd/chf) because you can increase your directional risk more than you realize.
It's easy to overweight your positions if you don't take correlation into account.
I am definitely not telling you what you're doing is wrong, I just wanted to give you a heads up as to how you may want to take correlation into account.
http://fxtradeinfocenter.oanda.com/charts_data/fxcorrelations.shtml
Here maybe that will help you.
which cross rates do you guys monitor???
I am currently looking at:
EUR/USD
GBP/USD
EUR/GBP
...again...to expose divergences for a "Strategically" profitable "short/sell" trade...
I am currently looking at:
EUR/USD
GBP/USD
EUR/GBP
...again...to expose divergences for a "Strategically" profitable "short/sell" trade...