Hey, I was just wondering what you guys thought were the best currencies to trade on forex besides the majors?
The Aussie, *If you use Oanda, the Aussie has a 2 pip spread (institutional rates) the pips are worth more (approx. 30- 50% more than the majors), so even though it seems to move less the dollar value of the moves are similar. *It doesn't spike around or move as crazily as the majors (bounces around in 10/20 pip increments usually). It has a slower tempo of movement giving you more time to think and react (unlike cable). *The intraday charts are "clean" ,I find not as noisy as other currencies. Technically speaking I often compare the intraday charts between currencies (especially tick charts) and the Aussie usually gives crisper chart signals to trade of. As a consequence I find I get less faked out from this pair. * The BIG sharks probably play with the majors (EUR/USD, USD/JPY, GBP/USD, USD/CHF), so the small/mid sized sharks have it more to themselves = less heart ache??. *AUS/USD = 4th or 5th most liquid pair (100 billion a day) so liquidity is absolutely not a problem whatever size transactions you have in mind. *You don't have to trade it during the Asian session, although it usually has a good move in that time. I'm looking at it more and more during the "traditional hours" - european/us session. *It's moves are tied to gold/metals (like the canadian etc.) so their is good volatility at the moment. I think it's the ideal currency for a beginner. I'm also biased as I'm from downunder!
One more thing (I learnt this from Ivanovich), Often when trading the Aussie and price is stuck in a range waiting to go to it's next swing point, XAU (spot gold) acts as a leading indicator. When price action/oscillators line up to put you into an Aussie trade, XAU/USD seems to move almost at the same time (if not sooner) in the same direction. Having say a 5 minute XAU chart up for example next to your AUD charts can be a useful leading indicator, it can give added power to your signals (although it should not be relied upon excessively).
Canadian has been good lately. For day trading though, I prefer EUR/USD or USD/JPY due to the one pip spreads. Sometimes half a pip, sometimes 2 pips, but usually around one. Jay
Jayford, Pardon my ignorance, but where are you getting a half pip spread from (surely not in the cash market ), and how is it with regards to slippage, etc.? With that kind of spread I would be scalping my b**** off for 8-10 pips all day (and night) long.
IB's commission is 0.2 pips but then there's the market ask/bid spread which varies according to market, right now hovering around 2.5-3 pips, Booktrader open right now in next window for EUR.USD. In comparison Oanda's spread is just their normal 1.5 pips for the same pair, right now.