Hi Patrick,
Well really the more the better, as a percentage gain of a big number is bigger than the same percentage gain of a small number.
But remember, only ever use money that ‘you can afford to lose’ [I always think thats an interesting phrase, it kind of implies the person expects to lose the money, which with regard to my service, certainly isn’t the case!]
Kind regards,
Josh
ps. please rate the thread 5 stars if you have found it useful. Thanks
Gyln I have replied to you email.
Nilesh I have replied to you email.
Chandan I have replied to you email.
Some great medium to longterm trades on GBP, CAD and NZD pairs.
Great correlation!
Anyone trading them??
If your trading multiple currency pairs then you really should be aware of correlation.
Currency correlation is calculated and displayed as ‘correlation coefficient’, which ranges between -1 and +1.
Perfect, absolute positive correlation (a correlation coefficient of +1) implies that the two currency pairs will move in the same direction 100% of the time. Perfect, absolute negative correlation (a correlation coefficient of -1) means that the two currency pairs will move in the opposite direction 100% of the time. If the correlation is 0, the movements between two currency pairs is said to have no correlation what so ever. They are completely independent and random from each other and there is no real idea how one pair will move in relation to the other.
Examples of same direction moving currency pairs
EUR/USD and GBP/USD
EUR/USD and AUD/USD
EUR/USD and NZD/USD
USD/CHF and USD/JPY
AUD/USD and NZD/USD
Typical inversely moving pairs
EUR/USD and USD/CHF
GBP/USD and USD/JPY
USD/CAD and AUD/USD
USD/JPY and AUD/USD
GBP/USD and USD/CHF
Being aware of currency correlation can be very useful, as it stops you fighting the inevitable and helps you maximise profits.
There are many correlation charts and calculators on-line…so… there’s no excuse, know your correlations!
Yep, I kicked off a few long term positions this week on a couple of them:
GBPUSD Short - Keeping a close eye on this one, chart looks a bit indecisive at the moment but confident for long term;
AUDCAD Short - Looks good for a run to at least 1.01500, already set stop to b/e and will drag the stop down if lower highs show up.
Waiting to short EURGBP - I wanted this one a couple of weeks ago when it bounced off the 50DMA but just forgot! Now waiting for the right entry again. It recently tested the 50% all time fib but failed, I’m hoping the next run will break through it.
Thought/critique always welcome!
Hi Nick,
Thanks for your post.
The GBP/USD is an intersting trade. Im not currently in the GBP/USD as my analysis suggests that a move above 1.6000 is reasonably likely [I haven’t studied it in depth though, so thats not to say your not right in your decision.]
I am however shorting the AUD/CAD and think your stop is very conservitly placed, so hopefully you won’t have much trouble there… well picked!
With regard to the EUR/GBP, I think I would want price action to pull back at least 100-200 pips before I personally would consider shorting it, but do expect there to be good bearish progress once this pullback is complete.
Kind regards,
Josh
In follow up to my reply to Nick above.
The GBP/USD and EUR/GBP have now moved siginifcantly upwards, although i think there will probably be more to come.
Did anybody else have the same opinion of those pairs? if so, why?
It seems you were right about the gbp/usd josh… I got blown out of that one, it was a daft trade to place and I broke my own Rule 3 (I have a list of rules to follow) - Rule 3, Don’t be impatient! Ah well, wait for the right entry now.
aud/cad position I reported above got stopped at break even, but that just presented a chance for better entry and now it’s cooking nicely. I’d be interested in exit strategies for this one, my target is currently at 1.0150
I suspect the $us might get another bashing at the end of this week, unless Bernanke can talk down QE3 at Jackson Hole, so I’d be careful of that one. I appreciate this is a Technical Trading thread, but I think entries should be fine tuned in consideration of news to avoid initial drawdowns.
Hi Nick,
Yes, rules are there for a reason. tut tut. lol
The AUD/CAD is a nice trade, well done. My limit for that is around 100 pips further on from yours, so I dont think you will have any difficulty there, or at least I hope not! lol.
With regard to the GBP, its made agains again today and still could make more. Its very important to be aware of how pairs are correlated against each other, they can provide strong suggests as to where another pairs price action may go.
The dollar is an interesting one and your right to be wary of news releases, always be aware of the economic calender.
I think a major factor for the dollar at the moment is the elections. I won’t be at all supprised if the dollar takes a real beating post election time.
Kind regards,
Josh
motormadj you don’t do signals anymore?
I have PM’d you Christina.
Hi Josh.
I was going to as the same thing as Christina 
Hi cpinoz,
Great minds think alike! 
I do still offer signals but just not for free anymore.
Kind regards,
Josh
Hello again Nick,
Did you reach your profit limit on the AUD/CAD, as it is now well past that price, as i predicted.
Did you trade correlated pairs along with it??
I mentioned in an earlier post about some nice trades on GBP and AUD pairs, did anyone one take them??, as I have just had a 624 pip long hit its profit limit on the GBP/AUD.
Happy trading!
Hi josh
Yes, I made a nice 220 pips on that one. It’s run further like you said, but I stuck with my plan and am not in the habbit of thinking “i could’ve left it longer” cos that sort of thinking can bite!
I’m not really sure the proper way to trade correlated pairs, but I do have a position still running on AUDUSD. I’m going for a longer run on this one and moved my stop to a small profit when the CAD order closed - sort of treating the two orders as one basket. I might ask you about that by email if you don’t mind, and if I can figure out how to explain my question!
Nice win on the GBPAUD for you there, good work
I don’t have GBPAUD in my catalogue yet - As I’ve said, I’m learning slowly, so limiting the number of charts I’m looking at while I learn how different pairs react.
Also been happily bagging plenty of pips on EURJPY swings with tight stops and 1:3 risk/reward - like taking candy from a baby right now! Not sure how long this 98-99 range is going to last but definately making hay while the sun’s out!
Happy days!
Hi Nick,
With regard to trading correlated pairs, for me, this is an absolute must. If you trade multiple pairs at the same time, knowing how correlated they are will mean that you can confirm or disregard certain things.
There is lots of useful information on the web about currency correlation, as well as on here on the babypips school.
The AUD/USD trade you have I’m assuming is a short, if it is, then you should have some nice pips on the board with it at the moment. I think price action is more than capable of going down past 1.0000 or even past the 0.9750, although I would put my profit limit well before that.
Kind regards.
Josh
Hey MotorMadj,
Do you still do signals ? How can I get your signals?
Can you please PM me your details!
Hello all,
The USD/CAD trade from earlier in the thread has just closed at a 431 pip profit.
Hope that gave some of you some good money!
Happy trading.
Hi,
I cant pm you, because as a newbie you dont have the capability.
Kind regards,
Josh
Mike, I have replied to your email.