Hello to all. Regarding the scenario provided in the lesson. Could you please confirm that this would only work if more traders bought USD/JPY than short EUR/USD ? otherwise, how come it isn’t the Yen that is benefiting from the selling of the EUR/USD ? Thanks.
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“More traders bought Usd/Jpy than sold Eur/Usd” The Usd’s cancel themselves out. That statement can be “More traders sold Jpy than sold Eur”. That would mean Eur/Jpy would be UP.
The similar scenario can happen where “More traders sold Eur (sold Eur/USD) than Jpy (bought Usd/Jpy)” which Eur/Jpy would be DOWN.
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In the scenario described, if more traders buy USD/JPY than short EUR/USD, it increases demand for USD, boosting USD/JPY. Conversely, selling EUR/USD doesn’t directly benefit the yen.
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Hello there! The scenario you’re referring to involves the USD/JPY and EUR/USD currency pairs. The movement in each pair is influenced by different factors and trading dynamics. In this case, if more traders are buying USD/JPY (thereby strengthening the USD against the JPY), and simultaneously selling EUR/USD (weakening the EUR against the USD), it reflects specific market sentiments towards each currency pair independently. The strengthening or weakening of each currency pair depends on various factors like economic data, geopolitical events, and market sentiment towards each currency. So, it’s not solely about more traders buying or selling one pair over the other, but rather the collective impact of market forces on each currency pair’s exchange rate.
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