FOREX: Considering the exchange ratioThe last few days has brought home some important insights about of currency pairs. The pair is a ratio of demand of one currency over another.
I couldn't go into every aspect of this in the video in just 10 min.
Based on my observations (which are not rules):
1. All pairs quoted in US-Dollars are vulnerable, as the Dollar heads south around this time.
2. Pairs with a ratio of less than 1, quoted in US-Dollars eg. AUDUSD and NZDUSD are more vulnerable due to serious fluctuations of the US-Dollar.
3. Pairs with a ratio of >1 are less vulnerable to the US-Dollar.
4. USDCAD is problematic for anyone wishing to go long at this time because USD is heading south, price of oil is heading north (which tends to push CAD up). So the ratio is expected to come under bearish pressure around now.
5. Pairs based on EUR are under bearish pressure. But EURJPY is heading north around now because the Yen weakened largely due to recent stock market moves north.
6. Pairs quoted in Yen are likely to be pretty volatile as stockmarkets bounce around.
The above observations are bound to be correct, as they are just my broad observations limited to the last week and probably the next two weeks . I'm not interested in correlations.
