Which currency pair trends most often & most smoothly during the UK trading session?

JTrader · May 2, 2007

Which currency pair trends most often & most smoothly during the UK trading session?

Hi

With a trend following strategy it would be Ideal to trade the currency pair cross that experiences the most trends, biggest price moves, and experiences the least periods of ranging/consolidating price action.

As I see it GBPUSD trends well, and price moves quickly.
EURUSD price action is more stagnant and price moves are comparatively less than GBPUSD due to it being more difficult for EURUSD to move than GBPUSD due to a deeper/thicker EURUSD order book.

Then theres another big list of currency pairs which I haven't looked at too closely.

Basically I'm looking for the currency pair that during the UK trading session has the smoothest trends, the most frequent trends, biggest pip moves, and least periods of consolidatory price action.

I'm wondering if any statistics exist anywhere that would help prove that one currency pair is more suited to trend following strategies than any others.

All input welcome!
Thanks.

fibonelli · May 2, 2007

Hi JT

I'm not yet trading FX at the mo. But having said that and taking a macro view, why don't you look at the some of the FX crosses where high yield currencies are financed through the ultra low yield "carry trade" currencies like Yen and SFr? Or, have a look at the generally appreciating Far Eastern (x Japan) currencies against the US$?

Regards

Fibonelli

jacinto · May 2, 2007

JT

To be honest, I think there is no such thing as "the currency pair that trends the best and in the cleanest form in the UK trading session".

Do remember FX is a 24 hr market. Yes, 25%ish of liquidity happens in London, and GBPUSD represents an important chunk of it. However, how many days havent you seen GBPUSD simply range-consolidate during the UK session?

The point I am trying to make is that FX (any pair any trading session) will go through phases where price contracts (consolidates) and explodes (trends). The issue is to be able to know which is happening during the UK session

I suggest looking at:

EURUSD
EURCHF
EURJPY
GBPUSD
USDCHF
AUDJPY

those are the ones that for me do the job in terms of "low spread" vs reasonable average day range.

j

JTrader · May 3, 2007

jacinto said:
EURUSD
EURCHF
EURJPY
GBPUSD
USDCHF
AUDJPY

j

Thanks chaps

Yes those pairs along with GBPJPY, AUDUSD & GBPCHF are the ones on my short list.

Besides having the pair with the smoothest trends & the least amount of time spent in a range, it would also be ideal that if during the UK session the most "ideal pair" was least affected by economic news....
But perhaps this is asking for too much :cheesy:

tar · Sep 9, 2008

JTrader said:
Hi

With a trend following strategy it would be Ideal to trade the currency pair cross that experiences the most trends, biggest price moves, and experiences the least periods of ranging/consolidating price action.

As I see it GBPUSD trends well, and price moves quickly.
EURUSD price action is more stagnant and price moves are comparatively less than GBPUSD due to it being more difficult for EURUSD to move than GBPUSD due to a deeper/thicker EURUSD order book.

Then theres another big list of currency pairs which I haven't looked at too closely.

Basically I'm looking for the currency pair that during the UK trading session has the smoothest trends, the most frequent trends, biggest pip moves, and least periods of consolidatory price action.

I'm wondering if any statistics exist anywhere that would help prove that one currency pair is more suited to trend following strategies than any others.

All input welcome!
Thanks.

U r reading my mind , which pair u can feel easly if it is trending ?

options · Sep 9, 2008

What Jacinto said.

Stick to the main 4 and out of them it has to be cable and/or Swissy for the stronger longer thrusts. :whistling

Eur/usd is the most heavily traded, European time but because of this it can be very choppy because of the push me/pull you effect. (Who says I can't get technical?)

The extra spread on cable is nothing, (Assuming your entry is good) compared to the bigger runs that Cable can put in.

Also look at the jap. I think that is a favourite of Trader Dante a the moment.

tar · Sep 9, 2008

options said:
What Jacinto said.

Stick to the main 4 and out of them it has to be cable and/or Swissy for the stronger longer thrusts. :whistling

Eur/usd is the most heavily traded, European time but because of this it can be very choppy because of the push me/pull you effect. (Who says I can't get technical?)

The extra spread on cable is nothing, (Assuming your entry is good) compared to the bigger runs that Cable can put in.

Also look at the jap. I think that is a favourite of Trader Dante a the moment.

Yah , i have noticed this when i watch EUR . what u mean jap ( usd/yen ) ?

tar · Sep 9, 2008

I checked efx volume at cme for EUR = 8.25 billion euros and 2.1 billion pounds for GBP . this is 3 times the volume

options · Sep 9, 2008

Eur/jpy or gbp/jpy

Look a the charts to tell you which one is in favour.

I have never traded either of these, so I know nothing about them. Just passing on that another trader has chosen to trade the Japanese currencies at some recent point in time.

Myself at the moment scalp the eur/usd and trend trade the cable, gbp/usd Or in any case. Try to.

tar · Sep 10, 2008

options said:
Eur/jpy or gbp/jpy

Look a the charts to tell you which one is in favour.

I have never traded either of these, so I know nothing about them. Just passing on that another trader has chosen to trade the Japanese currencies at some recent point in time.

Myself at the moment scalp the eur/usd and trend trade the cable, gbp/usd Or in any case. Try to.

I am a day trader , and i tried poundyen it is very choppy b4 it trends and this is a little bit annoying

tar · Jan 31, 2009

update.....

tar · Feb 1, 2009

what about usd/cad ? nzd/usd ?

Which currency pair trends most often & most smoothly during the UK trading session?

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