Learning Forex: Have you noticed that there is a relationship between the trading instrument in the market? In many cases, you may notice that when stock prices rise, bond prices will fall. Many traders will be watching correlations like this and try to take advantage of such opportunities.
This time, let us try to look at the relationship between the Australian dollar and gold price movements. Why? Because the fact is that Australia is a major producer of gold. You can use these relationships to try to optimize the profit opportunities in gold transactions.
This time, let us try to look at the relationship between the Australian dollar and gold price movements. Why? Because the fact is that Australia is a major producer of gold. You can use these relationships to try to optimize the profit opportunities in gold transactions.
Key
The relationship between gold with the Australian dollar came from the production capacity. As a result, it's natural Aussie currency follows a similar pattern to the movement of gold.
Ups and downs of production and the currency exchange rate will follow supply and demand in the currency exchange between miners and manufacturers.
Take advantage of the relationship
It is true that in general macro strategy does not always work on all levels of investment. However if you use a longer time frame, you will be able to see a strong correlation.
Technically, you can find the signal through charts to find the appropriate correlation in price movements. Chart the movement of gold or the Aussie will provide a solid formation if you can see the correlation of price charts.
An example of this will be seen in the following graph:
The relationship between gold with the Australian dollar came from the production capacity. As a result, it's natural Aussie currency follows a similar pattern to the movement of gold.
Ups and downs of production and the currency exchange rate will follow supply and demand in the currency exchange between miners and manufacturers.
Take advantage of the relationship
It is true that in general macro strategy does not always work on all levels of investment. However if you use a longer time frame, you will be able to see a strong correlation.
Technically, you can find the signal through charts to find the appropriate correlation in price movements. Chart the movement of gold or the Aussie will provide a solid formation if you can see the correlation of price charts.
An example of this will be seen in the following graph:
Well, now you can see that there is an opportunity to open long positions on gold when the movement of the Aussie or experiencing a bullish movement.
It is clearly seen that the Aussie and gold move in the same direction. Technically, gold prices move closer to $ 1300, relating to the movement in the range 0.8940 AUDUSD.
Trading Setup
Now let's look at setup by using currency trading the Australian dollar and gold. First, look macro movement widely.
It is clearly seen that the Aussie and gold move in the same direction. Technically, gold prices move closer to $ 1300, relating to the movement in the range 0.8940 AUDUSD.
Trading Setup
Now let's look at setup by using currency trading the Australian dollar and gold. First, look macro movement widely.
Look at the picture above, we see the price of gold has managed to penetrate the trend line. After this step, traders saw that the price of gold has been the trigger for the movement of AUDUSD. This is supported by the possibility that investors choose stocks will move their money into an instrument that is considered a safe-haven when global benchmark index continued to decline in value.
You can look at the same position on the movement of the Australian dollar accelerated following the bullish movement which penetrate the trend line and eventually bring prices to move upwards (see trendline to learn more).
You open a BUY position at the AUDUSD in the range of 0.9290 with targets at 0.9390 level. You can place a target at 0.7103 to provide risk-to-reward ratio of 1: 1. This transaction usually takes no more than one week when the target start in pairs.
You can look at the same position on the movement of the Australian dollar accelerated following the bullish movement which penetrate the trend line and eventually bring prices to move upwards (see trendline to learn more).
You open a BUY position at the AUDUSD in the range of 0.9290 with targets at 0.9390 level. You can place a target at 0.7103 to provide risk-to-reward ratio of 1: 1. This transaction usually takes no more than one week when the target start in pairs.
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