How Cross Pairs Work In Forex
Hi, the Yens more than most tumbled last week along with world stock markets.
I explain in the short video below what happened and how to calculate Yen cross pair prices and as a result why they are so similar.
My best advice is to leave them all alone for the next few days at least as historically they are more likely to overreact when bourses are crashing.
I show in the video why and how the Yen pairs often have very similar patterns and why I explain every week why you should only ever trade one of them at any one time OR reduce the risk accordingly.
Last week in the live session I analysed all of them and explained why I had chosen the Cad/Yen for my live account, but I also showed a complex way of entering the $/Yen in stages.
Because of their correlation with stocks all the Yens lost last week. Price simply cut through support and kept dropping. Considering the S & P suffered its biggest loss ever, we were perhaps lucky the Yens didn’t fall further and may well do so in the coming days.
Once again I explained during the session to NOT take more than one and yet some of you did and are now nursing bigger losses and wondering why!
If you had stuck to your money management rules then you would have simply lost one trade and movedon.com
On the demo I use for education purposes I still had the balance of the Aud/Yen running and got out with 430+ pips profit, so that almost covered the losses on the other trades.
Check out the short video here:
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