Psychology of trading USD pairs in different directions
Welcome to futures io.
(If you already have an account, login at the top of the page)
futures io is the largest futures trading community on the planet, with over 100,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.
At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors – all of which you can find on futures io, utilizing our social trading environment.
With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you don’t need to worry about fake reviews.
We are fundamentally different than most other trading sites:
We are here to help. Just let us know what you need.
We work extremely hard to keep things positive in our community.
We do not tolerate rude behavior, trolling, or vendors advertising in posts.
We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
We expect our members to participate and become a part of the community. Help yourself by helping others.
You'll need to register in order to view the content of the threads and start contributing to our community. It's free and simple.
Psychology of trading USD pairs in different directions
Hi fellow traders,
How do you all think when trading different futures contracts that move together or move based on something common (like major currency pairs). Examples:
Metals (HG,SI,PL) - Basic observation shows they generally rise and fall together
Currencies with USD as the quote currency (6A, 6C, 6B) - Basic observation shows they generally rise and fall together
If one in the group is falling (say 6C), do you hesitate to go long on another (say 6B) even if price action is showing it is headed up?
To what extent do you allow what the others in the group are doing to affect your decision making, or do you simply not factor that in at all?
I know that everything in a group can and often move independently due to them being two different things with just some things that affect them commonly, but from a psychological standpoint, should one just not allow themselves be affected by this at all and just trust in the market context and price action (as purely technical traders)?
Curious what you all think, and if anyone knows of any good books that speak to this or related topics! (preferably one about futures trading, but forex would be good too since the concept would be the similar). I'm very interested to learn about topics such as these which relate to proper way of thinking as opposed to systems or technical analysis.
Quick Summary is created and edited by users like you... Add FAQ's, Links and other Relevant Information by clicking the edit button in the lower right hand corner of this message.
Just wanted to update that I found the answer on my own. What I didn't know was that there's a name for what I was asking about and it's correlation. I've found material that answered my question perfectly and just wanted to share in case someone had the same question:
First of all this webinar from this very website regarding portfolio diversification:
Following the Trend, Diversified Managed Futures Trading by Andreas F. Clenow
To summarize: Looking at and trading with as much diversity (low correlation between assets) in your universe as possible will improve your performance and smooth out your returns by reducing volatility and drawdowns. This is the single most important factor to improving performance according to Andreas Clenow who stated novice traders tend to just focus on entries/exits but ignore this aspect.
For me this meant looking at rates and agricultural products which I generally ignored before.
The depth of the importance of this single point can't be understood nor felt just from my post of course. If you're unfamiliar with this concept, I highly recommend checking out the materials above!
logicalperson
The following user says Thank You to logicalperson for this post: