Focusing on 1 pair? - Page 5
Page 5 of 5 FirstFirst ... 3 4 5
Results 41 to 50 of 50
  1. #41
    Join Date
    Sep 2013
    Posts
    13
    Quote Originally Posted by FastStare View Post
    senior. do you scalp or swing?

    as a newbie, I just scalp for 1 pair Cross which is EURJPY because I have winning spree there. ^_^
    -scalping
    -hedging
    -tralling
    -correlations

  2. #42
    Join Date
    May 2013
    Location
    European Union
    Posts
    470
    Its not about the pair its the signal.You should look at as many pairs until you find a good signal.If GBP/USD doesnt give that to you try GBP/CHF ,if that is not good either try EUR/USD.So you should check them all and pick that one which has the best signal.

  3. #43
    Join Date
    Sep 2012
    Posts
    547
    Quote Originally Posted by Jezzode View Post
    One issue that I found when considering multiple pairs is that many of them provide the same signal at more or less the same time, especially pairs which have the cross as USD - obvious why really. As someone else mentioned in this thread, taking these trades at the same time is the same taking the same trade several times over in a single pair. This is one of the issues when you use the same trading strategy over several pairs - at least this is what I found.
    I think you have summed up an excellent reason to follow multiple pairs. Assume that AUD/USD and NZD/USD have been very closely correlated and CAD/USD has been in very close [anti]correlation mode with them. They can, if fact, offer the same signal at more or less the same time, as you mentioned. Let's say you notice that AUD/USD and NZD/USD have just reacted to a zone of support and are reversing their short trajectory and are now moving long. CAD/USD, lagging just a bit but still assumed to be an anti-correlating pair, is just now reaching what you have identified as a zone of resistance...

    Where do you think CAD is going?

    By following and keeping in mind the movements of all the majors and how they are moving and knowing which have been correlating, you sometimes get a brief glimpse into the future.

    In the above example you need only trade CAD but it sometimes certainly helps to follow multiple pairs. Meanwhile, you, following just one pair (not that there is anything wrong with it, btw), have no idea what the overall market is telling you and missed a great trade on another pair.

    Disclaimer: This was my primary trading method for a few years. Last November, as many will recall, longstanding, traditional correlations went out the window for an extended period -- so did my relying almost exclusively on this method to pull profits out of the market.

    Following multiple pairs for a technical trader is as easy as clicking a button a few times to gain a bit of an alternate perspective or view on what is going on. Your signal on your one pair says "Go long!" Meanwhile, every correlated pair and the indices say, "Go short!"

    You may get lucky on the trade but the odds are now definitely against it. Just one of the reasons I follow all the majors (and correlations).

  4. #44
    Quote Originally Posted by Alexander Rodionow View Post
    -scalping
    -hedging
    -tralling
    -correlations
    you are nerd guy. haha. anyway, that's your style.

  5. #45
    Join Date
    Mar 2013
    Location
    Toronto
    Posts
    504
    Quote Originally Posted by Proximus View Post
    Its not about the pair its the signal.You should look at as many pairs until you find a good signal.If GBP/USD doesnt give that to you try GBP/CHF ,if that is not good either try EUR/USD.So you should check them all and pick that one which has the best signal.
    GBP/USD, EUR/USD, AUD/USD and USD/JPY should tell you about USD right? Thats what I personally do.

  6. #46
    Join Date
    Sep 2010
    Location
    Cheshire, UK
    Posts
    1,807
    Quote Originally Posted by JohnLeonard View Post
    I think you have summed up an excellent reason to follow multiple pairs. Assume that AUD/USD and NZD/USD have been very closely correlated and CAD/USD has been in very close [anti]correlation mode with them. They can, if fact, offer the same signal at more or less the same time, as you mentioned. Let's say you notice that AUD/USD and NZD/USD have just reacted to a zone of support and are reversing their short trajectory and are now moving long. CAD/USD, lagging just a bit but still assumed to be an anti-correlating pair, is just now reaching what you have identified as a zone of resistance...

    Where do you think CAD is going?

    By following and keeping in mind the movements of all the majors and how they are moving and knowing which have been correlating, you sometimes get a brief glimpse into the future.

    In the above example you need only trade CAD but it sometimes certainly helps to follow multiple pairs. Meanwhile, you, following just one pair (not that there is anything wrong with it, btw), have no idea what the overall market is telling you and missed a great trade on another pair.

    Disclaimer: This was my primary trading method for a few years. Last November, as many will recall, longstanding, traditional correlations went out the window for an extended period -- so did my relying almost exclusively on this method to pull profits out of the market.

    Following multiple pairs for a technical trader is as easy as clicking a button a few times to gain a bit of an alternate perspective or view on what is going on. Your signal on your one pair says "Go long!" Meanwhile, every correlated pair and the indices say, "Go short!"

    You may get lucky on the trade but the odds are now definitely against it. Just one of the reasons I follow all the majors (and correlations).
    Great minds think alike right!

    It's funny you should say this as this is the very first trading approach which I used, or at least very close to this. I think I named it divergence between correlated pairs, be it positive or negative correlation. For example I used to track GBP/USD and EUR/USD on an overlay chart so that both pairs are together. If one pair made a higher high and the other correlated pair failed to make a higher high at the same time I would look to short the pair that made the higher high...Simple why really. Two strongly correlated pairs, one pair shows weakness before the other, short the pair that hasn't yet showed weakness.

    This approach did work, and it worked very well for almost six months, but then I came across an issue which in all honesty scared me. Correlation between pairs is not constant all the time, right, which means at some point a positively correlated pair will perhaps turn into a negative correlation...ouch.. now you're taking trades and the drawdown starts to kick in.

    (I'm the kind of person who hates not being in control (no I don't beat up women) but in terms of trading risk) So I decided to take a different approach to trading a primary correlation based system. I do indeed agree with you that it does work, and when the times are right it can work very very well. However, in my case I was struggling to calculate when and why correlated pairs lose correlation, how long this will last for and indeed when the strong correlation may return - without this correlation the profitable trades start to dwindle (an unknown I was not happy with)

    I now spend about 80% of my time following GBP/USD only, and have done for the past few years. I'm sure if I started looking at some other major pairs I could fit this trading approach around them too, but the main reason my current trading system works is because it focuses on a pairs stability, rather than which direction it is moving in or how it may or may not be correlated to other majors.

    I still play around with trading on a correlated approach, but have yet to find/develop a rigid foundation which takes into consideration when the correlation changes, a factor which is very much related to profits!

    It's good to see someone else trying this approach to trading, an approach which doesn't come to mind so easily and usually requires a good amount of research figure out.
    Last edited by Jezzode; 09-16-2013 at 08:39 AM.

  7. #47
    Join Date
    Sep 2012
    Posts
    547
    Quote Originally Posted by Jezzode View Post
    Great minds think alike right!

    It's funny you should say this as this is the very first trading approach which I used, or at least very close to this. I think I named it divergence between correlated pairs...
    I have never been accused of being a great mind before... my first instinct is too take that as an insult! Coming from you, however, I will accept it in the spirit it was intended

    Yes, determining when pairs will stop acting silly and get back in line with the rest is, by far, the most troublesome aspect of this strategy which is precisely why it is no longer my primary trading method. Abandoning it entirely is just unthinkable as I traded it for far too long and adopted the method from when I traded only stocks and trading stocks without following the indices is, to me, madness.

    When trading the opposite version of this (which I have played around with in the past), trading two correlated pairs that have moved beyond their standard deviations, one long and the other short, expecting a reversion to the mean is just like having your own printing press for money. Until you suddenly find out that pairs reversion trading is really just a very placid and serene lake where lives... the black swan.

    If you ever find that rigid foundation for when correlation changes should happen, let me know. It is the object of the ultimate quest and unfortunately, my name ain't Galahad.

  8. #48
    Join Date
    Sep 2010
    Location
    Cheshire, UK
    Posts
    1,807
    The black swan... every traders nightmare right! trying to predict the unpredictable, actually read a good book on that.

    The book was called "The Black Swan" by Nassim Nicholas, how convenient! Not to be confused with some ballet dancing book/film also called the black swan.

  9. #49
    Join Date
    Sep 2012
    Posts
    547
    Quote Originally Posted by Jezzode View Post
    The black swan... every traders nightmare right! trying to predict the unpredictable, actually read a good book on that.

    The book was called "The Black Swan" by Nassim Nicholas, how convenient! Not to be confused with some ballet dancing book/film also called the black swan.
    LOL I tried reading that book a few years ago... never got very far into it. A brilliant man, though, to be sure.

  10. #50
    Join Date
    Nov 2006
    Posts
    8,766
    Maybe you should focus on the major currency pairs first to get a good feel of the markets before moving on to commodity currencies and cross pairs. Do check out my thread on Daily Forex Fundamentals for your daily dose of economic analysis!
    "The only cable I watch is the pound baby."

Forum Sponsors

Similar Threads

  1. Should I stick to one pair?
    By alwayslearningfx in forum Newbie Island
    Replies: 26
    Last Post: 10-09-2015, 07:37 AM
  2. Buying a currency from a currency pair
    By gaminig in forum Newbie Island
    Replies: 2
    Last Post: 11-01-2011, 11:13 AM
  3. Focusing on a pair of major/minor currency?
    By hahnhahnhahn in forum Newbie Island
    Replies: 1
    Last Post: 08-06-2010, 12:38 PM
  4. Trading more then One Pair?
    By swordofrue in forum Newbie Island
    Replies: 18
    Last Post: 10-07-2008, 11:43 PM
  5. Replies: 0
    Last Post: 03-01-2007, 05:22 PM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
"The man who never makes a mistake always takes orders from one who does."
Daisy Bates