Which Pair?

Beginner Questions
1

Does it make sense to just follow just 1 pair, say the EURUSD, as opposed to following all 4 “majors”? Or possibly cross-pairs?

On the surface it appears as though the USDCHF does the opposite of the EURUSD. So watching both, or trading both, seems redundant. Also, it appears the GBPUSD and USDJPY tend to trend with the EURUSD, but in a more choppy fashion.

What about cross-pairs? EURJPY. GBPJPY. Do these have liquidity? Do they offer different price action then the majors?

Any advice is appreciated.

2

I think if you want to trade you can follow just one pair, so you can concentrate in the fundamentals and technicals aspects of that pair. But I noticed that when one currency is strong it is usually stronger with the other currencies, for example last week the Usdollar has been real strong with every currency, maybe except the JPY so you can trade in favor of the dollar, but remember to always watch the technical aspects of the currencies so you don`t take any chances.

3

Eh, it isn’t that the USD was strong. It’s more that the european market was under-performing heavily.

4

I exclusively trade the GBP/JPY. There is enough volatility and liquidity to trade on my schedule, and because I follow one pair I’ve developed a real “feel” for it. I have to monitor fewer news reports, and I’m better at spotting technical patterns when I’m focusing on one chart. I have been much, much more profitable trading just one pair than when I jumped around all over the place.

I don’t think it matters which pair you choose - I’m pretty sure I’d have been just as successful if I’d chosen EUR/USD, GBP/USD or whatever. The point is that you choose one and stick with it.

5

I agree with [B]Pip Wolf.[/B] In my case, the pair-of-choice is the GU.

Agree.

However, novice traders should choose from among the major pairs: EUR/USD, USD/JPY, GBP/USD, AUD/USD, USD/CAD and USD/CHF, especially the first four on that list. The liquidity in the major pairs (due to massive trading volume) makes them more suitable (than minor pairs or exotic pairs) for novices.

For novices, the GBP/JPY and EUR/JPY can be a bit of a handful.

And, although minor pairs (such as the EUR/CAD) can earn a handsome living for a skilled specialist, they can be way too quirky for a novice trader.

Agree.

Those traders who like to trade lots of pairs will argue that, when your favorite pair isn’t offering you a trading opportunity,
it’s nice to have other pairs to trade — to keep yourself in the game.

Those of us who trade just one pair will argue that, when your one-and-only pair isn’t offering you a trading opportunity,
it’s nice to get away from the computer screen, to spend some time with your family — maybe take the boat out.