Just look at the pictures below and ask yourself, “If I had to bed, which one would I bet on?”
Last week, It snowed at my house. I was playing in the yard with my wife and son. Take a look at this picture. If you had to place a bet on me or my son on who would win this snowball fight, who would you bet on?
Who would win this arm wrestling match? If you had to place a bet, would you choose the arm on the left or the one on the right?
Who would you place a bet on? This is easy.
In trading forex, if you pair a long term strong pair with a long term weak pair and go in the direction of the long term trend, you will be doing the right thing.
So here is some homework for you. Open your charts and be ready to answer some questions.
As of 2-17-2014, look at the following pairs and just make a note of what currency is strong or weak.
Weekly charts only… LOOK FOR ABOUT THE PAST 6 MONTHS…
W1 GBPUSD – IS IT GOING UP OR DOWN?
W1 GBPCAD – GOING UP OR DOWN?
W1 GBPJPY – GOING UP OR DOWN?
W1 GBPAUD – GOING UP OR DOWN?
If you had a gun to your head and had to guess, would you say the British Pound was strong or weak in the recent past?
Ok now look at another weekly chart. Look at the AUD.
W1 AUDUSD – IS IT GOING UP OR DOWN?
W1 AUDNZD – IS IT GOING UP OR DOWN?
W1 AUDCHF – IS IT GOING UP OR DOWN?
If you had a gun to your head and had to guess, would you say the Australian Dollar was strong or weak in the recent past?
NOW BASED UPON THIS, WHICH PAIR WOULD YOU TRADE AND WHICH DIRECTION?
IF YOU TOOK THE TIME TO LOOK AT THE CHARTS, THEN YOU WILL KNOW.
Newton’s first law of motion is often stated as
An object at rest stays at rest and an object in motion stays in motion with the same speed and in the same direction unless acted upon by an unbalanced force.