When looking at the short term price action of a particular trading pair, say NZDJPY, do I have to consider the price action of all other pairs which include either NZD or JPY?
If so, what is the best way to get a comprehensive idea of price action?
For example, I see a nice fib support level on NZDJPY, do I have to look at USDJPY to make sure there is nothing going to cancel it out?
I do check these other pairs as I like to take positions which follow not just the trend of the individual pair but which also aligns with the currencies’ other pairs. So if all the NZD-based pairs are falling, I would not normally want to be going long on NZD/XXX.
Bear in mind also that NZ’s economy is almost a sub-set of Australia’s, so it is worth at least looking at what AUD is doing when considering getting into an NZD pair.