The markets tell us so much about what we can expect. When it comes to each individual currency pair we can always rely on the other pairs to help us determine what direction price will eventually move towards. How do we do this? Look at the markets as a WAR and you are the General and it is your job to determine if your troops will win the small battles they each are involved with. The more your small battalions of troops win their battles, the more likely you will win the overall war. If some of the groups of troops start to lose footing and they have to fall back it will not lend well to your success. Examining the markets is very much like this.
When I scan through the charts I am always watching to see who is winning and who is losing their footing. Are buyers winning or sellers winning, are demand zones (forts/castles) holding or being taken over and destroyed by the opposition? If we want to take a long position on the #EURUSD for instance we want to see the castles representing demand holding and the troops moving forward attacking supply and if we see this all across the battlefield on the other cross pairs where the #DOLLAR is not the leading pair, then we can be safely be assured that we will win the war and it is safe to invest your money on the inevitable outcome.
This is how one should strategize when they plan a trade, this leads to more consistent profits and a deeper understanding on the markets!
Kevin Araujo
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