Saturday, July 14, 2007

how we profit then?

eur/usd and usd/chf move in opposite direction at almost same rate. almost.

eur/usd up, usd/chf down.

eur/usd down, usd/chf up.

almost but not perfect, not 100%. correlation could vary between 0.80 to 1.00.

generally 1pip for eur/usd for 0.1lot value usd1. 1pip for usd/chf for 0.1lot for usd/chf is usd0.80.

these two pairs move at different rates but almost symetrical.

there are times when 1 pair is moving and the other is not.

if we buy eur/usd and buy usd/chf, 1 trade will be positive, 1 will be negative.

There are times when positive trade value is more than negative trade value, and also times the other way around.

Positive value and negative value rarely, rarely move away very far in term of pips.

When the positive trade value is more than the negative value, net profit is achieved.

This happened few times almost everyday. So we could make profit by closing both trades when net trade is positive.

The important factor is margin and timing.....(to be continued)

1 comment:

InnerZahn said...

continue ler lagi che...