How to Trade Major Currency Through Currency Cross Pair
Major Currency , can anyone remember that this type of currency pair is a major currency ? if anyone doesn’t know, don’t be forced to read this article first, please read the article about major currency first . Why? so it’s nice to learn, connect, and not confused!
But if you really don’t want forex trading to use currency cross pair and just want to trade using a major currency , that’s fine. But you can use currency cross pair to help confirm your decision when trading using major currencies .
So currency cross pair can give you a keyword about the relative strength of each currency pair in major currencies .
An example is when you look at the graph of the movement of the GBP / USD and EUR / USD currency pairs and you find that they give BUY signals. And you can only choose one of the two currency pairs. Then the step you have to do is?
To answer the above question, you can see the movement of Euro Cross Pair EUR / GBP prices.
If EUR / GBP is moving down or downtrend then this indicates that the pound (GBP) is strengthening compared to the euro (EUR).
So the right answer is that you choose to open a BUY trading position GBP / USD compared to EUR / USD because the pound (GBP) is relatively strong against the euro (EUR).
When the euro is weaker than the pound and if the euro proves to strengthen again against the US dollar, it will strengthen the movement against the pound again.
If the US Dollar on all trading boards weakens against all currencies then your choice to open a trading position BUY GBP / USD is right because this currency pair will be your money-making machine because it will rally more than EUR / USD.
The following are some tips to help determine decisions in forex trading.
How to Know the Currency Cross Pair That Will Be Used
Let’s assume that the US Dollar is bearish or weakening:
- Cannot decide whether to buy EUR / USD or USD / CHF? please see EUR / CHF price movements!
- Can’t decide whether to buy USD / CHF or USD / JPY? please see CHF / JPY price movements!
- Can’t decide whether to buy GBP / USD or sell USD / CHF? please see GBP / CHF price movements!
- Can’t decide whether to buy EUR / USD or sell USD / JPY? please see EUR / JPY price movements!
- Can’t decide whether to buy GBP / USD or sell USD / JPY? please see GBP / JPY price movements!
So don’t forget to always look at currency cross pair to decide which currency pair to use when trading forex.