Trading EUR/JPY in US $

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sync

If I am trading a pair that does not contain $US such as EUR/JPY and my account is in US $, is my trade subject to US $ fluctuations during the time I am in the EUR/JPY trade? I don't understand what actually takes place if I put on a EUR/JPY trade.
 
Quote from TraderGreg:

yes.

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I had a look through that and couldn't find the answer.

The quote currency of EURJPY is JPY so the P/L from any trade will be denominated in JPY. That must be converted to USD in your case. The exact rate you get when your P/L is converted in to USD depends on your broker and when they do that conversion.

Here's an example:
USDJPY=100, EURUSD=1.5, EURJPY=150

You go Long 1 lot EURJPY
100,000EUR = 15,000,000JPY

say JPY falls 1% against EUR and USD
USDJPY=101, EURUSD=1.5, EURJPY=151.5

You close your position
100,000EUR = 15,150,000JPY
profit = 150,000JPY converts to about 1,485USD

So on that 1% move you only got 0.99%.
Conclusion: It's not worth worrying about!
 
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