Gbp/usd,eur/usd

[Seedsta]

Hi All,

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.

Im having some issues with currency ratios and knowing when to get into the trade (just follow the 1 hour or use more then one chart).

Does anyone know of some good training material on this that expands the concept?

THANKS!

[money_add]

Pay attention to the cable for possible movements next Wednesday, when the UK quarterly CPI is released.

[rhodytrader]

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.

[Seedsta]

Originally Posted by rhodytrader

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.

I know - hence that is why i have not traded it since 27th.

I also trade the NZD/USD,AUD/USD AND GBP/JPY,CHF/JPY

I have only been using this for a couple of weeks - and so far if I avoid being greedy (entering trades i know i should not), with trades having at least 200 pip disparity i can narrow my losses to a very minimal.

My problem is where to I set my stops? Because i know there will be a day when everything goes to hell in a hand basket...

[fxquantitative]

Yeah same with me, I didn't traded too.

__________________
FOREX GOLDEN SYSTEM
____________________

[MDunleavy]

A period of multi-week consolidation has now been broken to the topside with the market extending gains to fresh 2009 highs beyond 1.4340. The break above 1.4340 confirms a medium-term higher low in place by 1.3750 and opens the next upside extension back towards a measured move objective into the 1.4900’s over the coming weeks. Back under 1.4205 would now be required at a minimum to relieve topside pressure and potentially negated bullish outlook.[dailyfx]