A good trading strategy
What would you most likely to expect when a stronger and a weaker opponents are fighting. The most likely outcome is that stronger will win. Forex can be seen in the same way. Pairing a stronger currency with weaker currency can help you in forex trading. In pairs trading, you are always buying a currency and selling the other. You can use strength and weakness of currencies in your favor.
The good or ill of a man lies within his own will. – Epictetus
I do not agree at all or may be I do not get what you r trying to say. Currency pairs in forex move according to real time currency valuation and devaluation. A weaker currency is already weakened and it is hard to predict if it will weaken more or not. So unless you really analyze and compare currencies you cannot tell which currency will move up and which one will go down. According to your statement a weaker currency will most probably go down. But the problem is that the weaker currency is already down. I dont think this is a good way to analyze the currency pairs.
The "stronger vs weaker" strategy maybe good if you have a good knowledge about the specific currencies. I think stronger and weaker currency doesnt mean the overall value of a currency. It means the behavior of a currency in a specific period. If a currency is stronger vs another currency in some specific period then this strategy is good. But this is not a new strategy. All traders analyse this thing only and nothing else. Trends and graphs only show this data that which currency has performed better than the other currency in a currency pair. There are equilibrium gaps in currencies but to identify these gaps correctly is not an easy work.
Ironical, have you ever tried this strategy? After reading comments, I think it is difficult to implement this strategy because pairs are already in almost equilibrium state. Pairs tend to fill equilibrium gaps fastly and if you can predict those gaps correctly then you can win a trade.
Maybe we can understand you strategy if you explain a bit more.
Originally posted by ironicalWhat would you most likely to expect when a stronger and a weaker opponents are fighting. The most likely outcome is that stronger will win. Forex can be seen in the same way. Pairing a stronger currency with weaker currency can help you in forex trading. In pairs trading, you are always buying a currency and selling the other. You can use strength and weakness of currencies in your favor.
Man, you r 100% correct that forex currency pair trading is a game of stronger vs weaker. But you know one thing??????????? All strategies are made to understand this game. At a specific point which currency is stronger or weaker as compared to the other is impossible to tell unless you perform an analysis. All EAs, signals and systems etc try to find this thing.
Stick to your rules
If you buy EUR/USD it means you are buying the base-currency (EUR), and shorting (USD). That is all I think and trade the chart.
Personally I just look at the chart and do not pay attention to which currency is stronger at the pair. Strength and weaknesses are reflected @ the chart - that is what I think!
Keep it simple stupid
Originally posted by RichdeIf you buy EUR/USD it means you are buying the base-currency (EUR), and shorting (USD). That is all I think and trade the chart.Personally I just look at the chart and do not pay attention to which currency is stronger at the pair. Strength and weaknesses are reflected @ the chart - that is what I think!
I agree with you and unique that strength and weakness of a currency cannot be detected unless you perform some kind of analysis. There are different kinds of analysis as Richde said simple price action. There are many complex techniques too.
It is not a simple task to identify stronger and weaker currency.
Originally posted by ironicalWhat would you most likely to expect when a stronger and a weaker opponents are fighting. The most likely outcome is that stronger will win. Forex can be seen in the same way. Pairing a stronger currency with weaker currency can help you in forex trading. In pairs trading, you are always buying a currency and selling the other. You can use strength and weakness of currencies in your favor.
Hey buddy, can you tell how do you identify a stronger and weaker currency?
Stick to your rules
Hey buddy, can you tell how do you identify a stronger and weaker currency?
Is there a possibility of an indicator showing the possible strength of a currency? If anyone has seen it please share it.
Originally posted by JogiHey buddy, can you tell how do you identify a stronger and weaker currency?
Is there a possibility of an indicator showing the possible strength of a currency? If anyone has seen it please share it.
I have seen this kind of thing in the past. But I think you cannot predict future strength of a currency but the past strength of a currency based of different factors. I think it will not be wise to trade based on the previous data.
i start a thread with name of simple stratgy you can rad that strategy from my side comment on your thread.
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