
Originally Posted by
Seedsta
I found a simple strategy for these 2 pairs. Basically you over lay on 1 hour charts, wait for a good disparity between the pair with GBP/USD on the bottom. Long the GBP, Short the EUR and wait until they converge. If the trade continues to widen (200 pips +) consider another trade to capture even more of the disparity.
And what happens when the market just keeps going? Take a look at a EUR/GBP (which is what you're trading) and you'll see that it can have some very strong and sustained trends. If you get caught on the wrong side of one of those you'll watch in horror as your account equity disappears - especially if you're adding to the trade along the way.
John Forman
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