Quote:
Originally Posted by omelette
'cos the EA you posted with the PDF 'timed out' about a year ago  |
And you didn't think to ask or check out the many references to my yahoo group files in this thread? All my current files are here ---->
pacificforexgroup : Pacific Forex Group
Quote:
Originally Posted by omelette
I'm aware that this is the same as trading GBPCHF, which can trend for 1000's of pips, but I think there is a psychological benefit to trading both pairs.
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It isn't the same, though many people continue to repeat this statement because they read it in a post somewhere by individuals who stated an uninformed opinion as fact.
At an extremely basic level look at the elasticity. In the GBPCHF there is none. Zero. It is either up or down. Trading the GBPJPY and CHFJPY there is substantial elasticity as they both may be any combination of up and down. And, one can potentially trade for positive swap AND make a swing action profit even if both pair fall in value. Can't do that in the GBPCHF cross. I have discussed this in more detail in previous posts in this thread.
Further, if they are the same, one would expect that the drawdown in the two pairs to exactly match the drawdown in the GBPCHF from July 1st to now (it was 1,046 pips to be exact). Since they don't match, they are not the same.
Correlation trading has a relationship between the two traded pairs and its cross, but it is NOT the same as trading the cross directly. There is more than just a psychological benefit to trading the pairs - the benefit can also be mathematical.
Trade carefully,
Bill