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I have been on a winning streak and now nervous to take new positions

Bisho777
Jan 30 2013 at 10:43
192 příspěvků
its another debatable issue... back-testing :D

for me i would backtest for one year, it would build my confidence of a certain strategy , n would give me a good experience for different trade scenarios..

mylin_m19
Jan 30 2013 at 10:50
40 příspěvků
ok i understand - but this not a trading entry-exit i am testing, it is more like managing capital - and will not change given the market scenario? frankly, i am not sure if i will be able to backtest things properly.. 😳

mylin_m19
Jan 30 2013 at 14:04
40 příspěvků
Just another quick question - say if i want to be long eurgbp can i go long eurusd and short gbpusd? How is it different from trading eurgbp on its own? Can there be a point when eur/gbp is different from eurusd/gbpusd?

Repco
Jan 30 2013 at 22:05
48 příspěvků
mylin_m19 posted:
Just another quick question - say if i want to be long eurgbp can i go long eurusd and short gbpusd? How is it different from trading eurgbp on its own? Can there be a point when eur/gbp is different from eurusd/gbpusd?


Technically speaking, by going long on EURGBP = Long EURUSD and Short GBPUSD. Both yields the same result, but when the market is moving too fast such as spikes, there might be a difference between the two as the Quotes on EURGBP will be slower. I have not heard about EURGBP misaligned but other crosses did-especially those that isn't as popular with some as wide as 50pips apart

mylin_m19
Jan 31 2013 at 10:54
40 příspěvků
Ok, so say i have a long term eurgbp buy signal this would mean that i am essentially long for eurusd short gbpusd sell signal. If in short trend if eurusd goes down and gbpusd goes up while eurgbp continues going up - i can do counter trades with small take profits? I am sure someone has tried this - any sight will be useful.

Repco
Jan 31 2013 at 11:39
48 příspěvků
mylin_m19 posted:
Ok, so say i have a long term eurgbp buy signal this would mean that i am essentially long for eurusd short gbpusd sell signal. If in short trend if eurusd goes down and gbpusd goes up while eurgbp continues going up - i can do counter trades with small take profits? I am sure someone has tried this - any sight will be useful.


No, f EURUSD goes down GBPUSD goes up then EURGBP will be down. The only time EURGBP goes up is when news events when the dealer / market didn't price in the fast movement of the market at that time. If it does happen on EURGBP on misalignment, it last for seconds or minutes only...

mylin_m19
Jan 31 2013 at 14:36
40 příspěvků
Ok cool, dont think I will be able to do such quick trades.

I am asking just random questions here - but another one, eurusd and gbpusd are far more voatile than eurgbp.. does that mean that crosses are less volatile than mainstream trades? Is this always the case? What is the difference between an illiquid currency and a volatile currency?

Repco
Jan 31 2013 at 18:55
48 příspěvků
mylin_m19 posted:
Ok cool, dont think I will be able to do such quick trades.

I am asking just random questions here - but another one, eurusd and gbpusd are far more voatile than eurgbp.. does that mean that crosses are less volatile than mainstream trades? Is this always the case? What is the difference between an illiquid currency and a volatile currency?


No...Crosses are not less volatile. It is mainly because if EURUSD rallies GBPUSD is likely to rally as well...Thus it comes down to who rallies faster EUR or GBP. If the green back is weaker across the board, then all the majors will advance. If EURUSD up 1% and GBPUSD up 1%, you will see EURGBP unchange. But if EURUSD up 1% and GBPUSD down 1% you will see EURGBP up 2%.

mylin_m19
Feb 01 2013 at 09:51
40 příspěvků
Thats weird, because the average number of points that EURGBP moves is far less than that of GBPUSD and EURUSD? Basically I place my stops depending on the average movement of the currency. As I am planning to risk only 1% of my capital, I am looking for positions that move on average that many pips.. and cant seem to find much except EURGBP, AUDGBP, AUDCAD, USDCAD. Any recommendations?

Repco
Feb 01 2013 at 09:55
48 příspěvků
mylin_m19 posted:
Thats weird, because the average number of points that EURGBP moves is far less than that of GBPUSD and EURUSD? Basically I place my stops depending on the average movement of the currency. As I am planning to risk only 1% of my capital, I am looking for positions that move on average that many pips.. and cant seem to find much except EURGBP, AUDGBP, AUDCAD, USDCAD. Any recommendations?


EURGBP move is less of GBPUSD and EURUSD reason is the same as my previous post, if USD is weakening across the board = EURUSD will be up and GBPUSD will be up....When you are comparing the two that is up EURGBP = Which of the two moves faster. If EURUSD is up 0.4% while GBPUSD is up 0.5% then EURGBP will be down 0.1%; if EURUSD is up 0.5% and GBPUSD is up 0.2%, then EURGBP will be up 0.3%.

All currency pairs have different characteristics, just stick to what you do best.

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