Trading Opportunities in the Forex Pairs With the Biggest Movement
Cory Mitchell, CMT
The following chart shows the average daily movement of currency pairs in terms of pips, dollars (based on 100,000 contract), and percentage. These are based on the last two weeks and are sorted via percentage. Pairs you don't trade, or don't have access to, can easily be removed or disregarded.
Volatility analysis can help to focus on the pairs that are moving the most. Typically, the pairs that are moving the most will be a combination of a strong currency and a weak currency.
Just because something is near the top of the list doesn't necessarily mean it has a good trade setup right now.
Let's go down the list a bit. The AUDJPY has ranked among the top-moving pairs for months. This is a pair that should be on the radar regularly. It has also been in an uptrend for the last several months, so we would be on high alert for buying opportunities.
The chart below shows a nice trade setup along a rising trendline on the daily chart. The price contracted and then broke out to the upside. This is a classic trend continuation trade with a greater than 3:1 reward:risk (based on daily chart entry) and positive rollover as the AUD interest rate is higher than JPY.
USDSEK is another one. It is in a downtrend, recently had a pullback to the upside on the daily chart, but then started to roll over again. July 6 it put in a strong bearish engulfing pattern, and so far on July 7 is continuing to the downside.
I am always monitoring volatility, whether it daying trading the EURUSD or assessing swing trade potential. It can be helpful to know how much something is moving, and what is moving the most/least, depending on your strategy. I use the volatility tool (and correlation tool) on Mataf.
By Cory Mitchell, CMT.
Disclaimer: Nothing in this article is personal investment advice, or advice to buy or sell anything. Trading is risky and can result in substantial losses, even more than deposited if using leverage.