Since my trading experience is very short (1 year), I would like to get the perspective to those who are more experience traders around.
I have found this information from my broker regarding what to expect per week on a EUR/USD currency pair.
• [I]2 days of the week – Won’t do much (finish roughly flat)
• Once a week – False break & potential reversal
• 1 day a week – Respectable movement (50-70 pips from OR highs/lows)
• 1 day a week – Hit a ‘homerun’ (ex: 100 pips and more)
Furthermore, if a “homerun” is achieved earlier in the week, the likelihood of it occurring twice in the same week is slim., (if it does it’s typically in opposing directions) [/I]
I am not really familiar with the other currency pair as I only focusing on the EUR/USD for now.
On a technical/fundamental analysis, what I would like to know, to those who are trading this pair for years, if this is accurate. For months trading this pair, I believe it is…
100 coin tosses will average 50% heads and 50% tails. That’s historical fact. But, if you do 99 flips and go over the numbers…it doesn’t give you an edge on predicting the last flip. Luckily, charts are not as random as a coin toss, so looking into why price behaves that way will open up much more information that you can act on. Perhaps it’s a base to start from though.
…and yeah that sounds about right but I personally wouldn’t act on it unless other things agree that are reliable…and I would act against it if those other things agree.
I think its rather irresponsible to try and attach a set criteria to specific currency pairs. We could set almost any criteria which a currency pair is ‘likely’ to follow. In reality this is not the case…at all!
@ Petefader ; I like the “coin tosses” analogy:). Yes, I do agree that this info is a good base to start from.
Of course, I wouldn’t act on it if it is not fit on my trading plan. Thank you for your feed-back. I really appreciate it.
@ Jessey: Glad you find it interesting Have a great weekend to you too…
PipNRoll - nice question - wish I would have thought to ask it years ago.
I believe the answer you have is both responsible and acceptable – I think however I would generalize it as to not get sucked into a sort of false sense of Oh - it should do this now because it already did that - -hope that makes sense.
I think of it this way - -the week will do 1 of 3 things
It will move in 1 direction all week.
It will move 1 direction part of the week - then the other direction.
It will move back and forth and that is it.
True… However, a currency pair doesn’t rally/sell off 5 days a week either. There are day(s) in a week that either in range/consolidation, breakouts/fake outs, reversal, and just plainly flat no matter what the reason is.
