Anyone trade just one currency?

[permanentjaun]

Anyone only trade one currency?

I'll admit that I'm getting burnt out trying to find my own strategy. I look at charts all day. I find a strategy that I feel works and then I look at a different time frame to look for confirmation and everything I worked on is thrown out the window.

Then, even using the same strategy on different currencies just doesn't seem so great. I don't know why I don't feel like I had these problems with stocks.

Again, I'm trying to go KISS. So now I'm considering looking at just one currency. Since I can easily be long/short I imagine I could always have a position in it. Am I digging myself into a hole thinking like this?
My thinking is that currencies are always moving. Stocks can go into periods of inactivity as volume leaves them. Currencies, especially the majors, always have volume. There may be sideways movement in a day, but week by week it seems that they will move at least 100 pips. If you count the total up/down and add them it could possibly reach 500 pips. There seems to always be money to be made/lost.

I'm posting this for one, to get some frustrations out, and two to ask the opinions and advice of others. Have others tried trading just one currency? What troubles can I expect to experience when doing so? Are those troubles any different from trading multiple currencies? Am I only shooting myself in the foot by trading just one currency?

All opinions welcome.

Burnt out in the October heat. Matt

[fxValius]

Hi,

Try to build your strategy by asking yourself what do you know about the markets, how the markets move and not by looking at several time frames and instruments. Make it as simple as possible.
Of course at the beginning it is better to trade one currency pair(i recommend dollar pairs), because you have to familiarize and feel how it moves.
Personally i trade only EUR/USD and GBP/USD.

[JohnJay]

Trading one currency pair would be advisable if you are learning about forex. It definitely would give a trader enough action. Like you said, they are unlike stocks which can lay dead for months. If you feel overwhelmed trading only one then it will be worse trying to trade many others. It will be more confusing to try and pinpoint where your errors may be then try to rectify them.

I guess your decision also depends on your strategy. If it is a uniform approach with other currency pairs then trading more will give you more opportunity to trial your system. If you have a strategy which requires you to focus on a forex pair, then you might be better off trading less pairs.

...Just my opinion.

Personally, I trade many pairs at once. Up to 10.

[SoundFX]

I have recently tried to limit my pairs, down to GBP and CHF mainly. As far as strategy, try using nothing but trendlines. You want KISS? That's it. There is no better methoed IMO for entering and exiting trades than the humble trendline. Try varying methods of drawing them as well. The low to low and high to high is fine, but for more accuracy, one needs to be able to see how to draw trendlines through the MEAT of the market. Admittedly, this takes a little more knowledge, but not much. Kind of an art.

-S

[JR97]

I used to trade every pair under the sun thinking I could "average" out. But now for me, it boils down to USD pairs or JPY pairs. So now I only trade USD/GBP because it moves the most most per day out of the major USD pairs. I have done very very well with that. Occasionally I'll dip into another pair if I see a setup, but only if I see a bone fide setup. On pound, I trade every nook and cranny.

Anywho.. do what feels right to you. I have profitable friends that trade multiple pairs and do very well. I also have losing friends that trade only one pair and get their ass handed to them daily.

[cka6c]

I agree with KISS, keeping with a simple strategy at first seems to be the most advisable. There are so many people out there who think brokers who offer x amount of currency pairs are better when in reality even great traders stick to the majors.

[mwbro]

i trade eur/usd only plenty to made on that currency pair alone

[permanentjaun]

Glad to hear others trading only a few currencies. Someone posted the following on another forum.

Average Pips per day:
EUR/USD 111 pips
USD/JPY 102 pips
GBP/USD 156 pips
USD/CHF 127 pips
AUD/USD 85 pips
NZD/USD 81 pips
EUR/JPY 112 pips
GBP/CHF 161 pips
EUR/CHF 55 pips
GBP/JPY 172 pips
AUD/JPY 80 pips

Tokyo Open 7:00 PM Tokyo Close 4:00 AM
London Open 3:00 AM London Close 12:00 PM
NY Open 8:00 NY Close 5:00 PM

Tokyo Trading Session
7:00 PM - 4:00 AM (EDT)/Average Daily Volume $210 bn
Tokyo is the first major market to open, and many large participants often use the trade momentum there as the benchmark to gauge market dynamics as well as to devise their trading strategies. Trading in Tokyo can be thin from time to time; large investment banks and hedge funds are known to use the Asian Session to run important stop and option barrier levels.

Most Active Currency Pairs
With activity, and subsequent liquidity, mostly concentrated in the British pound based currency pairs, (GBP/JPY, GBP/CHF), traders will find the most opportunity in trading these pairs after the 7PM EDT open. USD/JPY, AUD/USD, NZD/USD and their crosses also provide good opportunities as liquidity and momentum remains supported from the previous US session into the relatively lighter Asian session.

Useful Tips
Currency pairs to avoid
Market participants will want to avoid opening entries in any euro based pair (EURCHF, EURGBP and EURUSD) until the London session when European traders anticipate the open.

For "active" or volatility traders
USDJPY, GBPCHF and GBPJPY are good picks because their broad ranges provide short-term traders with lucrative profit potentials, averaging at 90 pips.

Risk averse?
USDJPY, GBPUSD and USDCHF are good choices because they allow medium to long-term traders to take fundamental factors into account when making a decision. The moderate volatility of the currency pairs will help shield traders and their investment strategies from irregular market movements due to intra-day speculative trades.


London Trading Session
3:00 AM - 12:00 PM (EDT)/Average Daily Volume $580 bn
London is the largest and most important dealing center in the world, with a market share of at least 30% and trading volume around $580 billion. Most of the dealing desks of large banks are located in London; the majority of major FX transactions are completed during London hours due to the market's high liquidity and efficiency. The vast number of market participants and their high transaction value makes London the most volatile FX market among all.

Most Active Currency Pairs
Traditionally a more volatile market, the London session is a good opportunity to transact in various GBP and EUR based currency pairs. As a result, currency pairs like GBPCHF, GBPJPY and GBPUSD comprise a considerable percentage of the volume, presenting favorable trading opportunities for market participants. The following pairs also exhibit much activity USDCHF, USDCAD, and EURUSD.

Useful Tip
JPY based pairs begin to lose their daily appeal and should not be considered for momentum trades as these currency pairs volume declines shortly after the overlap period ends.


New York Trading Session
8:00 AM - 5:00 PM (EDT)/Average Daily Volume $330 bn
New York is the second most important market in FX, with approximately 16 % of market volume. New York trading is very liquid and is responsible for over 14% of world FX volume. In the United States spot market, the majority of deals are executed between 8AM and 12:00PM, when European traders are still active. Trading often becomes quite choppy after midday however, as liquidity dries up. In fact, there is a drop of over 50% in trading activity since California never served to bridge the gap between U.S and Asia. As a result, traders tend to pay less attention to market development in the afternoon. NY is very much influenced by the US equity and bond markets and pairs will often move closely in tandem with the capital markets.

Most Active Currency Pairs
Offering the most possibilities, the New York session provides activity and liquidity in USDCHF, GBPUSD, USDCAD and EURUSD, subsequently most dollar based pairs. Additionally, GBPCHF and GBPJPY momentum spills over from the previous session and comprises a good percentage in New York.

Useful Tip
Here, as a precaution, EURGBP and EURCHF should be avoided as liquidity dissipates during the overlap and does not rekindle until the following London open. As a result, the thin market will cause fluctuations that are unfavorable for the profit seeker



From this I've concluded that the really popular currencies are GBP/USD, GBP/CHF, and GBP/JPY. I'll try to cut down my trading to just those three and not get caught up in the distractions of other currencies that don't trade similarily. My focus will primarily be on GBP/USD and then GBP/CHF. My only concern is that GBP/CHF and GBP/JPY have spread of 8 and 9 respectively while GBP/USD is 4. I use GFT. Is this about the same for everyone here?

Anywho, I imagine if I focus on just GBP/USD and maybe all three it'll be easier to find a method that works well for just those 3 rather than 15-30 currencies. At least this way if I have to trade each pair differently it's easier to find methods for 3 than finding and managing methods for the 15-30. Guess it just comes down to how in depth I get with each currency.

Do you all agree with the post I brought here? Does it seem like truthful and factful information? Matt