A question on related pairs

So let’s try one currency say the USD. Try one pair say USDCAD and the other is the EURUSD.

As you know these 2 pairs will be affected whenever the USD rises or falls opposite of one another.

Let’s say you watch the charts of the USDCAD and it shows that it is rising and you do the same for the EURUSD and it also shows the same thing. Would you long on both pairs because if the USDCAD rises the EURUSD will fall and not rise since the USD is rising.

In this case would you long both pairs?

Your question makes no sense. You already said both pairs are rising but then you said EURUSD will fall.

Just because USDCAD is rising doesn’t mean EURUSD will fall.

EUR might be stronger than USD which might be stronger than CAD.

This would mean the USDCAD will be rising and the EURCAD will be rising.

However this is why you really should be using a currency strength indicator. Think about the perfect trade setup. A strong currency vs a weak currency. A strong USD and a weak CAD will magnify the move enabling bigger profits.

Having two strong currencies will result in a range or very weak trend move.

I use this on the FXCM trading station platform. It’s the best one. However you don’t even need this if you go straight to the source. The currency Index charts…


No read again.

I said if the USD rises the usdcad will rise but the eurusd will fall.

I was asking would you trade both of these pairs and if both showed them rising and if the eurusd is rising it’s obvious the usd is falling for it to rise.

No i’m afraid you’re not understand how it works.

“if both showed them rising and if the eurusd is rising it’s obvious the usd is falling for it to rise”

This is not true. The USD does not need to be falling for the EUR to rise. Both the USD and EUR can be strong and rising. but the EUR can be stronger!

This results in an up move on the EURUSD.

Again, you need to look into currency strengths.

I would not trade both pairs either way. By trading two pairs with the same USD currency you are simply doubling your risk.

Usually when USD is getting stronger than any other counter currency is getting weaker, but in your example everything is possible. There is no guaranty that if USDCAD is rising that EURUSD will fall.

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