A Winning Strategy
The 28Pairs Currency Strength Trading System - also known as Double-GAP Strategy - is our primary trading philosophy and is based on exploiting individual currency strength and weakness.
The principle idea is buying strength and selling weakness. It is a fundamental strategy for investors in all marketplaces. Most amateur retail traders in Forex either ignore this winning strategy or are unaware of it.
With this strategy, we look at individual currencies rather than currency pairs and then buy the strong currency and sell it against the weak currency. It will give your trading a real edge.
When we refer to the market, we mean THE 8 major currencies and the 28 currency pairs derived from those 8 currencies.
The market must always be seen in equilibrium. When one currency is bought, another(s) must be sold. We can refer to this here as the flow of money. (It may be that we use terms differently on this page than they are usually used).
When we analyze the market, we look at the entire market, which for us means 8 currencies and 28 pairs. (Exotic pairs are not included at the moment).
When most traders look at one chart to find a trade setup, they would have to check 28 charts to understand what the Forex market is doing. When you use the Currency Strength28 strategy, you only look at currencies, not pairs, and for that, we only need to check ONE CHART! Do you understand the advantage now?
So let's first take a look at the 8 main currencies, which are:
US dollar, Euro, Yen, and Pound, these are the most important ones because they have the largest trading volume, then there are Swiss Franc, Australian, Canadian, and New Zealand dollars.
Every single currency belongs to a single economy. Some currencies tend to be bullish, others to be bearish. You cannot get this information from a single pair chart. For example: If the EURUSD pair is trending up, you won't know why by looking at a single chart. Maybe the Euro is strong and the USD is flat, or the Euro is flat and the USD is weak, or even both are strong and the Euro is just stronger. Remember that there are two currencies paired in each chart, called the BASE and the QUOTE currency.
To maximize your profits and minimize your losses, you need to know how a single currency behaves in the context of the entire market. To stay with our EURUSD example: A EURUSD chart only shows you 1/28th of the market, so you only have a small amount of information on which to base your trading decision. Since each currency can be paired with 7 other currencies, you should base your trading decision on the information provided by all 14 pairs (7x2). By using the Advanced Currency Strength28 Indicator, you can get all this information from just one chart.
You may already know all this, but stay tuned, we will add a new type of technical analysis!
The goal of the strategy is to find out the sentiment of the market and which pair is good to trade and which is not. As a trader, you should know if a currency is trending, consolidating or reversing as this will give you information on how to trade. Are we looking for a continuation or are we looking for a pullback/reversal? This is THE most important information you need to trade and this strategy will give you the answer!
1112 pips winner!
With 1 lot trade size, it will pay about $10 per pip depends slightly on the pair.