Educational ContentTV

Video: How To Pick the Most Trending Market Every Week (And Know Which Ones to Avoid)

Powerful trading concepts to boost your consistency and long-term performance in the Forex, Indices & Commodities markets.

Click on the video to watch the full breakdown

Do you ever find yourself having these frustrating thoughts at the start of a trading week?

“There’s too many markets that look good to trade. I don’t know which one to choose! This is overwhelming.”
or
“I want to focus on one market, but I don’t know how to tell which one is the best choice.”
or
“This market I’m interested in could trend this week, but I’m not sure. I wonder if there’s a way to tell if it will…”

The result: Analysis Paralysis

This is typical...

Don’t get frustrated. With forex being such a big market with an endless number of opportunities, possibilities and methods to consider, we must cut down on the number of charts we monitor, and filter out the noise, in order to be successful.

So how do I create a high probability shortlist for myself?

The answer is simple: look for opposing-trend currencies. In other words, find the strongest currency you can and pair it with the weakest.

How do you do that? Use the currency futures markets as your guide.

You’ll find them in TradingView, with these code names.

Just like the Dollar Index (DXY), every currency has its own index too. You could go into all the pairs and analyse manually how your particular currency is performing against all others. But this is faster.

This Futures Indices come particularly useful in those times when you’re not fully confident in your technical analysis of the charts and reading the candles. These charts give you more data on how the currency is performing as a basket – i.e. across the board, as it relates to other currencies.

So what do I look for specifically in these charts?

Look for the clearest most obviously-trending one-directional chart (or currency in this case).

Example of a clearly-trending market — to the Sell side

So, for example: a clearly Bullish trend on the CAD (strength), combined with a clearly Bearish trend on USD (weakness), would give you the scenario to look at USD/CAD for a Sell setup. The opposing directions indicate a high probability for the market to move hard in one direction, which would produce a result that looks similar to this, below.

This is what happens when you do the pairing successfully – a very strong trend is the result

Remember the rules of low probability scenarios:

Two strong currencies cancel each other out – creating a ranging market behaviour.
Two weak currencies cancel each other out – creating a ranging market behaviour.

Example where both charts are Bullish and therefore it’d be a bad choice to combine the two currencies

And as always, if you can’t tell what’s trending/strong/weak, then best avoid that currency completely.

The practical use

The key to using this method with more accuracy, is to look at the Weekly chart (like the examples here) and anticipate not only the overall trend, but the immediate direction the market is likely to go, based on last week’s (i.e. the previous) candle.

Watch the video for more examples.

Written by: Dima Mihailovich, Technical Analyst for Forex Prop News

Contact and follow Dima on Twitter: @dimafpn

Image by Geralt on Pixabay

(Please note: All comments made in this video and article are not trading or investment advice and are for education purposes only. You are responsible for your own decisions and the risk that goes with it.)

Leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Our Newsletter

Subscribe to ForexPropNews Trading Newsletters

Receive the best-curated content by our editors for the week ahead.

Mini Charts

Fidelcrest video review

Play Video

Related Articles

New to Forex? Learn to Read Charts Like a Pro

Dive into forex trading basics: chart reading, candlesticks, technical indicators, timeframes, currency...

TV

Video: Here’s the Trade Plan for EUR Pairs, as ECB Interest Rate is Announced Tomorrow

Here's the Trade Plan for EUR Pairs, as ECB Interest Rate is...

TV

Video: Watch These Setups on CAD and JPY Pairs, with Big News Incoming

Watch These Setups on CAD and JPY Pairs, with Big News Incoming

TV

Video: How to Skyrocket Your Profits from *One* Trade Setup (Plus: This Week’s Trade Results)

How To Squeeze More Profits from ONE Trade Setup (Plus: This Week's...

Featured educational content

EXPLORE MORE

Featured educational content

New to Forex? Learn to Read Charts Like a Pro

Dive into forex trading basics: chart reading, candlesticks, technical indicators, timeframes, currency pairs. Start your journey to trading success today!

Video: How I Re-Programmed My Mind to be a Consistent Trader (Thanks to The Wolf of Wall Street)

How I Re-Programmed My Mind to be a Killer Trader (Thanks to The Wolf of Wall Street)

Video: This Invisible Trading Indicator Tells you What Day Trade (Not Just Price)

This Invisible Trading Indicator Tells you WHEN to Trade (Not Just Where)

Technical Analysis: Chart Patterns and Indicators for Profitable Investments

Navigate stocks with confidence using chart patterns like Head and Shoulders, indicators such as MACD, and tools like trendlines. Master technical analysis for...

Latest News

Learn to Read Charts
Educational Content

New to Forex? Learn to Read Charts Like a Pro

Dive into forex trading basics: chart reading, candlesticks, technical indicators, timeframes, currency pairs. Start your journey to trading success today!

EUR/GBP Struggles
Market News

EUR/GBP Struggles for Momentum as Eurozone Growth Falters

German GDP fell by 0.3% in Q4 2023, while EUR/USD tests 200-SDMA resistance amid mixed economic data.

Copyright © 2023 Forex Prop News. All Rights Reserved.