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π± Currency Cross Pairs: How to Tradeβ
π Continuing the topic: let's talk about the features of strategies for standard cross-assets available on any trading platform.
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Technical analysisDoesn't require any special tricks. It is necessary to clearly define the support/resistance zones on the higher timeframes (D1, H4), but it is not worth reducing the analysis timeframe below M15. Chart patterns work well on crosses, especially reversal (Double/Triple Top, Head-Shoulders) and trend continuation patterns, as well as Price Action patterns. The methods of wave analysis and fractals are less effective due to their close connection with the fundamental analysis of the currencies included in the cross-pair.
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Carry tradeThe strategy requires the attraction of significant funds in order to earn on the difference between the interest rates of the Central Banks of different countries. Currently, interest rates for major currencies have practically equalized, and this technique has become unprofitable for ordinary traders.
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Cross rate as a leading indicator for dollar pairsThis is how highly liquid cross-rates work - EUR/GBP, EUR/AUD, EUR/JPY, GBP/JPY, AUD/JPY. So, with the growth of inflation in the eurozone, the market will buy EUR for GBP, CHF, or Yen, which supports the EUR / USD pair - this phenomenon is usually called ""support in cross-rates"". Moreover, such βguidesβ are more effective in closing positions than in entering.
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So if you treat cross-pairs with respect and reasonable risk, then you can consistently earn money on them.
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Profits to y'all!