Hello everyone,
I would like to know if it is valid to trade currencies and other related products at the same time, for example XAU/USD, AUD/USD, USD/JPY and if professional traders do it.
thank you
you can trade whatever you want at the same time
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If you’re a beginner, I think you should focus in fewer pairs at once, but professional, well seasoned traders deal with every one at once
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Trading multiple pairs makes the TA work-load high. Its easy to make a mistake if you’re trying to do in-depth TA on 20 charts every 10 minutes.
Holding multiple positions can lead to heavy concentration of money (and risk) on one currency or conflicting positions on one currency - so buying AUD/USD and EUR/USD and selling USD/JPY is a massive short on USD.
Buying AUD/USD and selling EUR/USD means you are neutral on the USD.
Both are bad if they are not part of your strategy. Which would be a bit advanced.
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Thank you very much is the answer I needed!
types of currencies based on the 1971 nixon doctrine are: direct pair, indirect pair. while the currency that is traded on a futures exchange is crossrate. every currency in the world has a correlation.
The calculation of the currency value in a futures exchange differs between direct pair and indirect pair.
direct pair is fixed, which is 1 point worth 10 $.
while the indirect pair is calculated from its futures value by formula, the price is divided by the square of the price.
for example usdjpy is now 110.00 then per point is 110.00 / 110.00² = 0.00909. means that 1 yen point has a value of 0.9 $. it affects the required margin.
If you know about all correlations between, then you know what the market will.
Spot market is different with futures market.
You can see futures market in reuters, dowjones and kind of contributor price.
Futures market running first then followed by spot market. So if you know how to calculate futures price then you will know spot price.
Spot market is lag. Futures market run first.
Tommorow NFP, you can see the price of futures market move quickly and volatile 5 minutes before NFP data release.
So thats why suddenly any jump price when the data release.
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