How Many Currency Pairs Should You Trade? (Podcast Episode 4)

this is the Forex Q&A podcast this is VP
professional Forex prop trader and creator of —
Mission Control for all things Forex a great blog all the videos that end up on
my youtube channel this here podcast and a place called ask
VP where if you click on that tab you can ask me any forex trading related
question that you want to ask and I will answer you very quickly and often at times
it’s gonna make an episode of this show and what I’ve done so far is take the
more basic Forex questions and answer those first because I don’t really know
who out there is listening do I have mostly beginning traders do I have
mostly people who haven’t even traded Forex yet and just want to or do I have
people who have put five ten fifteen years in and are just yearning to learn
more or trying to make their trading better I don’t know you so I figure the
best thing I can do is start with the basics but regardless of how long you’ve
been trading you’re gonna want to hear my answer to these questions because
even if they seem basic to you I come at things from such a completely different
angle that an answer I give to even the most basic questions might just be
integral in changing your forex trading around forever
at least that’s what I’m trying to accomplish now when I say no-nonsense
Forex I mean it the site itself is very basic very clean very easy to navigate
no ads just kind of a one-stop shop for blog video podcast everything and that’s
on purpose every other Forex site you go to has some measure of crap on it that
you don’t want to click on that you don’t want to see that you don’t want to
deal with hell even this podcast has no advertisers it doesn’t even have music I
don’t have an intro or an outro it’s just me in front of a microphone
transmitting the best forex advice possible straight into your headphones
and here in episode 4 this question I think is very important for all of you
listening no matter how long you’ve been trading because I will bet you don’t
trade like I do when it comes to my answer to this question and I’m not so
arrogant to sit here and say that you should trade exactly like I do but I do
trade professionally and I do trade for only 10-15 minutes a day and then I get
to live my life after that that’s pretty good I mean can we agree
that doesn’t suck? and if you want to get closer to that I am going to show you
how and as always when I answer a question I’m gonna really state my case
and give points to back up why I feel this way and by doing that if I can get
you further away from your old way of trading that isn’t very successful and
into a much better and easier way of trading then I’ve done my job so let’s
go ahead and get into the question this question is from Tariq from New York
City he asks how many currency pairs should I trade and that was it very
short question now guys I’m gonna tell you my answer and it’s gonna seem a
little crazy but don’t stop the podcast finish this out and let me explain why I
say what I say and I think you’re gonna like my answer at the end even though
it’s gonna seem a little bit unusual at first when Tariq asks how many currency
pairs should I trade my answer is 27 because that’s how many currency pairs I
trade in forex now I also trade metals that’s another conversation for another
day but when it comes to actual spot forex trading 27 pairs is your magic
number and I’ll tell you how I got there but first I want to explain to the brand
newbies what I mean by currency pairs and how I got to 27 and for those of you
who trade a lot less than 27 maybe just one or two or three or four I want to
tell you also and explain to you why that is a gigantic mistake and how the
mentality behind why people would only trade so few currency pairs is just
downright silly and really makes no sense at all so first things first as
far as the currency pairs that I trade I take the 8 major currencies for some
reason you don’t know what those are it’s the Euro the pound the United
States dollar the Aussie dollar the New Zealand dollar the Canadian dollar the
Swiss franc and the Japanese yen now if you take every combination of those 8
major currency pairs and minus 1 you end up with 27 now I do not trade your more
exotic pairs you’re crazy currencies out there like the Mexican peso Turkish lira
South African Rand things like that and that’s another conversation for another
time again I want to keep this podcast relatively
short but those 27 give me the best chance of winning and that’s what I
suggest you trade as well so I trade the daily chart and I trade it almost
exclusively and if you don’t understand why or don’t know why go back to episode
3 and explain exactly why I do it and why you should – I feel very strongly
about trading the daily chart only and I make a really good case for it so if you
haven’t checked that episode out please do after you’re done with this one and
let’s be honest if you’re gonna trade 27 different currency pairs on a 15-minute
chart you would lose your mind so what I do is I take my little algorithm my
little system I put together with my tools and indicators and at 2 p.m.
Pacific Standard Time I take a look at all 27 of my currency pairs and I see if
any of them tell me to do anything whether it’s make a trade maintain a
trade I’m already in or do nothing and move on to the next one and what’s
really good about having 27 of them there is there’s a chance a really good
chance that I’m gonna do something on any given day it really takes away a lot
of that dead time that can happen when you trade that daily chart because I’m
getting 27 different chances for my charts to tell me to make a move and
this turns out to be really great I’m usually never in more than three or four
trades at one time it’s very easy to manage and you know I’m almost always in
the market doing something but a lot of you don’t do that and I want to go over
the reasons I hear the most of why somebody only trades a few different
currency pairs or sometimes only one currency pair which I totally don’t get
so I will run into people who no bullshit say I only trade the euro
dollar and I say okay why get answers like well it’s the most
liquid pair it’s the one I want to trade or I will get the answer and I really
hate this one I just want to get good at one currency pair before I move on to a
different one so let’s attack both of those one by one first off the euro
dollar is the most liquid pair yes I did an entire video if you guys haven’t seen
this please go watch it it’s on my youtube channel I think it’s on the site
right now – why the euro dollar really isn’t a great pair to trade especially
if you’re new I do trade it but I’m a professional who’s been doing this a long time, I don’t trade it nearly as
often as I do a lot of pairs but for somebody who’s brand-new it has so much
working against you you need to know what that is and you need to move on to
something different if you really insist on only trading one pair don’t make it
the euro dollar that’s the last pair you should be in really any dollar pair and
if you want to know more I’ll link that video down below for you but the people
who only trade a few different currency pairs only trade one because they they
want to get really good at those before moving on to other ones that is complete
nonsense when it comes to a daily chart over time
they all pretty much move really close to the same way people say things like
well the the pound dollar likes to stay in a range or the Aussie yen likes to
trend yeah it’s doing that right now that doesn’t mean it’s going to do that
into the future and the future is what we are going to be trading to sit there
and say the pound dollar does this and the Aussie yen does this is ridiculous
it’s doing that right now check your history go back does it always move like
that no it trends it falls into a range it
consolidates it goes crazy it does nothing for an extended period of time
just like every other currency pair out there you just don’t know when that time
is going to be if you sit there and say the pound dollar is range-bound the one
time it stops being in a range you’re going to get killed get that stupid
mentality out of your head if I were take the daily chart
and take a random currency pair and erase all the numbers and erase all the
dates and set it at one given point in time in the last I don’t know three
years and let’s say I showed you kind of a six months man but I didn’t tell you
when that span was and I were to just show you the price action and I say okay
what currency pair is this you would have no idea I would have no idea
nobody would currency pairs do not have their own unique movement at least not
on the daily chart which is really where you want to be in the first place I will
say it again currency pairs do not have their own unique movement stop acting
like they do do not be afraid of the Swissy yen because you don’t know
anything about it or it’s not super liquid like the euro dollar is chart
wise it moves the same as everything else does just at different times of the
year oh and some people also say well I do really well on the dollar yen you
have a lot of success there you have a lot of success there now because it is
moving in a way that really supports the way you like to trade let me tell you in
ten years of doing this all of that is going to change you just don’t know when
and maybe the biggest reason why you need to be trading many more currency
pairs than you currently are is that you’re severely limiting yourself by
only trading two three four pairs if you have a really good system in place and I
have a really good system in place but you’re only trading three pairs and I’m
trading 27 I’m going to make a lot more money than you are if you’re trading
three pairs and I’m trading 27 I have nine times the opportunity that you have
if you’re only trading two or three pairs you know who you are and we all
know this girl you know that girl who’s really pretty but she’s like 6 feet 3
inches tall and she only dates guys that are taller than she is and then she
wonders why she can’t find a good guy you are that girl sitting there
wondering why all your relationships fall apart but you’re limiting yourself
to only 2% of the entire population cut the bullshit do better why wouldn’t you
open up your trading horizons take the little algorithm
little system that you put together for yourself on a technical level duplicate
that on 27 different currency pairs on the daily chart and you’re always going
to have some kind of skin in the game this is how you create the best chance
of making the most money possible in the market over time if I can somehow
convince you to exclusively trade the daily chart and to trade 27 different
currency pairs all combinations of the eight majors then you are a lot further
ahead than many people let me tell you many people who have put five ten
fifteen years into this game already because so many of those people have
already developed the worst habits they’re so inside their head with their
15-minute chart and their four currency pairs they like to trade because at some
point in time they had success with it and they can’t get that success out of
their head you as a newer trader get to start out way ahead of these people the
experienced traders the ones who have put years into trading are the ones I’m
gonna have to convince the hardest and a lot of them are just gonna keep doing
what they’re doing and not listen to me if you’re a newer trader please
start off the right way it is gonna put you so much further ahead then not just
people who are starting out with you but people who’ve been doing this a very
long time and you have a free podcast to thank for that now I almost forgot this
there is one currency pair one combination of the eight majors that I
do not trade which one is it it is the Euro Swissy I am a trend
trader the Euro Swissy at least now has been tied together for such a long time
that it doesn’t really trend in such a way to where it trips my algorithm and I
can actually make money off it it’s just not worth my time and that’s okay
trading 27 instead of 28 is just fine with me the euro Swissy is nothing
but a headache it’s more fundamentals driven than anything which is really the
last place you want to be and I am 100% okay just completely eliminating it from
my trading but the euro Swiss see I have no time for so there it is to recap all
of the episodes up until this one go to baby pips comm slash school to learn how
to trade Forex but make sure you listen to episode number 2 where I tell you
which parts you need to pay attention to and which parts you don’t trade the
daily chart exclusively if at all possible if you need convincing you’re
for need reasons why that’s where episode 3 comes into play and to really
set up your best chances of winning after that trade every pair every
combination of the 8 major currencies minus the euro Swissy and if you can
just get this far let me tell you you are well on your way to exactly where
you’ve always wanted to be in forex trading and if you’re really serious
about taking your trading further go to the No Nonsense Forex YouTube channel
it’s all free there’s videos there to cover some of the most important forex
topics that for some reason nobody has ever been told before I’m blown away by
how many people email me and say I have never heard this discussed anywhere and
I’ve never heard it explained the way you explain it like I said I’m gonna link that
euro dollar video below also check out the big banks video check out the number
one strategy video I mean this site the YouTube channel the podcast is still
brand new I barely have any content out but even the content that’s out there
right now is really really great I put my best foot forward put some of
my best content out early so you guys can get everything set up right and
really get into that winning mindset before we start getting more technical
and drilled deeper into some of these things so thank you for listening new
podcasts out every Monday starts your week right get yourself set up right go
attack those markets make that money and start setting yourself up to win and
really dominate this market and I will see you in episode 5 go get it

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