Difference between what you want to do and what you're good at?

[Chartsy]

I've been battling back and forth for weeks whether or not to trade just the EURUSD or include all pairs in trading. Thing is i've done best at eurusd and pretty average at the others.Though i put the monthlies of the USD pairs and they pretty much move the same way as the others, so why even bother with pairs that i'm worse at? im probably not being clear here but in my case i want to trade every pair and keep track of the fundamentals of dozens of economies, but i seem to be much better at trading one and knowing its fundamentals well, and still paying attention to general news.

 

[shadowninja]

I wanted to trade GBP/USD but have given up on that pair completely since April because I realised looking back on records for just that pair that my performance was being held back - 20-30% of trades were profitable, if that.

 

[Hilarymannah]

Chartsy,...Personally, I only actually trade one pair GBP/USD, although I keep track on the EUR/USD and USD/CHF,..there are very few occasions the GBP/USD are flat, but when they are, and only then, I jump over.
Master one pair, and you'll never have to trade anything else!
As always,..Keep It Simple Stupid! (KISS)
I only ever look at major economic news releases (in order to exit a trade or not), the rest are nonsensical, unless you're a position trader.

 

[Black Swan]

I've been battling back and forth for weeks whether or not to trade just the EURUSD or include all pairs in trading. Thing is i've done best at eurusd and pretty average at the others.Though i put the monthlies of the USD pairs and they pretty much move the same way as the others, so why even bother with pairs that i'm worse at? im probably not being clear here but in my case i want to trade every pair and keep track of the fundamentals of dozens of economies, but i seem to be much better at trading one and knowing its fundamentals well, and still paying attention to general news.

Presumably you mean trade a few more pairs; the most liquid? TBH I just don't get how folk can say they can't trade other pairs, EJ follows EU fairly uniformally and obviously EU has opposite correlation to USD/CHF (other than today's spike when the Swiss bank messed about again but hah I stayed in the short trade and it went down further you cheese loving b@stards )

All depends on the TF's, and how you evaluate/consider the spreading of your risk but I have to say an edge is an edge, and other than the Swissy spazzing off, they all 'behave' in a similar way and tbh I'm not gonna avoid GJ due to the spread cost and if you're a position trader it makes no odds...

 

[Shakone]

The problem with trading other pairs Black Swan is twofold. First it can distract you from trading properly. If you are an hourly trader or higher this isn't really a problem, but if you are a 5-min or 1-min trader, then it becomes tricky. Second, if you're not careful you end up with highly correlated positions (i.e. I'm trading eurusd and gbpusd) which increase your risk beyond what you wanted. Even a pair like EURJPY which I trade is still quite highly correlated to another instrument I trade, and the correlation is not immediately obvious.

 

[Chartsy]

Presumably you mean trade a few more pairs; the most liquid? TBH I just don't get how folk can say they can't trade other pairs, EJ follows EU fairly uniformally and obviously EU has opposite correlation to USD/CHF (other than today's spike when the Swiss bank messed about again but hah I stayed in the short trade and it went down further you cheese loving b@stards )

All depends on the TF's, and how you evaluate/consider the spreading of your risk but I have to say an edge is an edge, and other than the Swissy spazzing off, they all 'behave' in a similar way and tbh I'm not gonna avoid GJ due to the spread cost and if you're a position trader it makes no odds...

yes, i don't understand, they see eurusd and say its a good long, and see audusd and it also looks good long, so they take 2 long, when really you're 2Xshort USD and you may as well just go long one!

 

[Black Swan]

The problem with trading other pairs Black Swan is twofold. First it can distract you from trading properly. If you are an hourly trader or higher this isn't really a problem, but if you are a 5-min or 1-min trader, then it becomes tricky. Second, if you're not careful you end up with highly correlated positions (i.e. I'm trading eurusd and gbpusd) which increase your risk beyond what you wanted. Even a pair like EURJPY which I trade is still quite highly correlated to another instrument I trade, and the correlation is not immediately obvious.

I'd only suggest multiple pairs if swinging, I reckon the most I could *cope with* (trading off 5 mins or scalping off lower TFs) is 2 pairs. More than that and I'd end up being sectioned Have day traded several pairs off 15-30 TFs and coped..originally a blast, but no better off than swinging...

Given he's position trading he could perhaps trade the loonie, UJ and the aussie dollar for points of trading difference..plenty of liquidity, iirc they're 3 out of the top 5 traded in terms of volume, so his spreads are low and the probable behaviour is less erratic..

 

[Black Swan]

yes, i don't understand, they see eurusd and say its a good long, and see audusd and it also looks good long, so they take 2 long, when really you're 2Xshort USD and you may as well just go long one!

If light crude didn't treat traders like Naomi Campbell on one of her bad days I'd love to trade it and nothing else...Fantasies of living abroad, getting up with the sun, lazily trading it at 100 quid a pip when NY opens, after a morning of kite surfing...then 'Naomi' ruins it..

It's all going well then it turns on you, the sleek black beauty stabs you with a kitchen knife and puts a stiletto in your eye. Then gets bailed out and is nice and sweet and behaves like a purring panther...for a week or two..then it all starts again...

 

[charliechan]

I've been battling back and forth for weeks whether or not to trade just the EURUSD or include all pairs in trading. Thing is i've done best at eurusd and pretty average at the others.Though i put the monthlies of the USD pairs and they pretty much move the same way as the others, so why even bother with pairs that i'm worse at? im probably not being clear here but in my case i want to trade every pair and keep track of the fundamentals of dozens of economies, but i seem to be much better at trading one and knowing its fundamentals well, and still paying attention to general news.

its crystal clear. youre in conflict:
greed wants to trade all markets thinking more money will be available
brain wants to stick with 1 and make money.

all markets have different characters, even fx pairs. thats probably why youre losing on other pairs.

i think youre answering your own question anyway. stick to the 1 for now and know it inside out. follow related pairs, perhaps for confirmation using them as leading/lagging indicators. eur, gbp, chf v usd.

ps. stay away from anyone who mention liquidity and fx. there is no such thing in fx as liquidity as your broker will always give you a price if your retail.

 

[Black Swan]

its crystal clear. youre in conflict:
greed wants to trade all markets thinking more money will be available
brain wants to stick with 1 and make money.

all markets have different characters, even fx pairs. thats probably why youre losing on other pairs.

i think youre answering your own question anyway. stick to the 1 for now and know it inside out. follow related pairs, perhaps for confirmation using them as leading/lagging indicators. eur, gbp, chf v usd.

ps. stay away from anyone who mention liquidity and fx. there is no such thing in fx as liquidity as your broker will always give you a price if your retail.

Really? So in your opinion the volume of trades/liquidity doesn't affect the pair's 'behaviour' or "different character" as you term it?

 

[Chartsy]

its crystal clear. youre in conflict:
greed wants to trade all markets thinking more money will be available
brain wants to stick with 1 and make money.

all markets have different characters, even fx pairs. thats probably why youre losing on other pairs.

i think youre answering your own question anyway. stick to the 1 for now and know it inside out. follow related pairs, perhaps for confirmation using them as leading/lagging indicators. eur, gbp, chf v usd.

ps. stay away from anyone who mention liquidity and fx. there is no such thing in fx as liquidity as your broker will always give you a price if your retail.

err forex like any market has a spread...the more liquid the market, the tighter the spread...am i missing something?!?!? hence why exotic pairs' spreads are pretty massive

 

[Chartsy]

I'd only suggest multiple pairs if swinging, I reckon the most I could *cope with* (trading off 5 mins or scalping off lower TFs) is 2 pairs. More than that and I'd end up being sectioned Have day traded several pairs off 15-30 TFs and coped..originally a blast, but no better off than swinging...

Given he's position trading he could perhaps trade the loonie, UJ and the aussie dollar for points of trading difference..plenty of liquidity, iirc they're 3 out of the top 5 traded in terms of volume, so his spreads are low and the probable behaviour is less erratic..

i was thinking of possibly a good JPY pair along with EURUSD.But even long term, there's still that correlation, i'd rather just trade the one and have a few intermarket themes for a bit of confirmation.

 

[Adamus]

Chartsy,

if you want to be in the thick of it with all the currencies, check out NVP's forex correlator and the never-ending thread he's got going there. The correlator does give you all currencies on the chart at the same time, but you do lose sight a bit of reality - it all seems like a horse race sometimes.

ps. stay away from anyone who mention liquidity and fx. there is no such thing in fx as liquidity as your broker will always give you a price if your retail.

Do you mean that my broker (IB in my case) is the one who benefits from the liquidity and I get whatever is left over that IB's algorithms pass on, in terms of distance from the onscreen midprice?

Or are you talking about something completely different?

 

[charliechan]

yeah - very few people who trade fx get the liquidity idea at all.

when you place your order with o&a, fxcm etc, youre NOT part of the x trillion liquidity they suckered you in on. all your 'broker' is doing is taking the other side of your trade. i.e. trading against you.

if o&a, fxcm etc have a large aggregate exposure from all their customers positions, he MAY offset it in the interbank market (thats the REAL fx market). YOU, as a customer, don't even get to see the REAL fx market that you think your part of. besides, why would x trillion of liquidity be a concern for someone with 50k in their account???

the quotes youre given by your broker may be based around current market prices, they may not. they may be a few pips out sometimes, especially when advantageous prices are available.

so, please tell me what liquidity on a market you dont actually trade on has to do with where you take a position? hmmm....

have any of you fx masters ever had a split fill with a retail fx broker? thats a sign of a liquidity issue. in fact, do retail fx brokers even quote size they are good for with price, or just the price?

hope that helps....

 

[Black Swan]

yeah - very few people who trade fx get the liquidity idea at all.

when you place your order with o&a, fxcm etc, youre NOT part of the x trillion liquidity they suckered you in on. all your 'broker' is doing is taking the other side of your trade. i.e. trading against you.

if o&a, fxcm etc have a large aggregate exposure from all their customers positions, he MAY offset it in the interbank market (thats the REAL fx market). YOU, as a customer, don't even get to see the REAL fx market that you think your part of. besides, why would x trillion of liquidity be a concern for someone with 50k in their account???

the quotes youre given by your broker may be based around current market prices, they may not. they may be a few pips out sometimes, especially when advantageous prices are available.

so, please tell me what liquidity on a market you dont actually trade on has to do with where you take a position? hmmm....

have any of you fx masters ever had a split fill with a retail fx broker? thats a sign of a liquidity issue. in fact, do retail fx brokers even quote size they are good for with price, or just the price?

hope that helps....