Why do you trade Eur/Usd?
Seriously……we’ve got a comment section here underneath the posts – and I’d love to know.
Is it because you think you “should” trade this pair? Is because you’ve been hypnotized? Brainwashed? Perhaps influenced by strange voices in your head? What?
I don’t trade this pair…much if at all – in that, there is no real fundamentals behind it. As the two most widely held currencies on the planet ( yes I’ve said this before ) one goes up , the other goes down, then up , then down ,blah blah, blah – who freakin cares.
Fact of the matter is ( and likely unknown to most newbies ) this pair can easily move anywhere between 1.27 and 1.37 ( and even as far as 1.25 to 1.40 ) with little or no effect on global trade, a given countries economic outlook, import/export blah, blah, blah once again. Pull a 5 year weekly chart on the pair and do the best you can to “plot anything of real significance” short of it being in “normal range”.
To see bigger payoffs trading forex, you’ll want to pit the safe havens against the commodity related currencies, as opposed to trading the “two headed step child” Eur/Usd.
That being said – I may look long the pair in coming days.
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Reason… I’ve been doing it so long that it’s relatively easy. Why pass up doing something you know so well when it makes you money? 😉
Go man go!
If it’s working for you – you’ve got it….no passing up on that.
While enjoying a cold Colorado brew with Chicago Sean, I was once asked the same question. My response was one that references the diagram in the below link. A strategy of holding government debt could be analogous to the use of Khat (whatever the hell that is), while the buy and hold strategy of equities could be compared to Tobacco. However, trading the EUR/USD is closely compared to the use of Heroin in both potential physical harm and dependency. In addition, once this rabbit hole has been embarked on, it will take a great deal of time and effort to crawl out.
http://upload.wikimedia.org/wikipedia/commons/9/9c/Rational_scale_to_assess_the_harm_of_drugs_%28mean_physical_harm_and_mean_dependence%29.svg
I’d say that steadily-declining or stagnant economic output in the Eurozone, combined with few entrants into the monetary union, in the face of modest GDP growth in the US would provide some motivation for trading EUR/USD on the short side. Even though it’s been range-bound since mid-09, it has been characterized by a slight downward bias. That said, the deflationary action in the Eurozone has provided a nice counterweight to what would otherwise spell weakness in the unit. Still, I agree in that the cross is the most boring (and most overhyped, until it breaks out of its range) of them all.
I find this post funny. Not because of the content but because of what it made me question. I have traded forex for couple years as well as commodity, bond, and index futures. I almost always have a eur/usd position whether it is long or short but I am laughing at myself because it is kind of an odd cross. The euro situation is degrading and the US situation is improving which should really lend itself to a eur/usd short. But Euro balance sheet vs US balance sheet says otherwise. Also, eur/usd tends to move a bit with general risk sentiment. So, all I am getting at is this should really be a confusing pair to trade. It seems to me that following general risk sentiment with eur usd seems most important. Sorry for the poor writing. I am writing via mobile and I am in Vegas and kind of drunk!
Lots of amateurs on forums all over the world discussing eur / usd trades which is helpful to see the sentiment of the crowd.
Here’s my take.
As a newbie FX trader ‘wanna be’ i like to focus on pairs that have a lot of volume. The two ideal majors are GBPUSD and EURUSD. Now i only ever look at these two pairs because as a newbie two is about as much as i can handle.
Why EURUSD? Its great as its highly technical. By that i suppose i mean it behaves itself most of the time. It adheres nicely to support and resistance lines and also fibs. Its a thing of beauty and its a great vehicle to stick your L plates on.
Id say if you are new to the game trade EURUSD and GBPUSD.
JPY pairs are f*cking scary and have a habit of going thermo nuclear on your account when you are wrong on a trade and that was before the BOJ decided on pressing print. Now its even harder.
Stay away from EXOTICS also. You can get a disease.
I dont care for fundamentals because im not clever enough to really understand what effect they may have on a pair. I just trade the technicals.
EURO all the way!
Still long the dollar =)