Just some thoughts on how I've developed my trading style over time. It’ll include some facts about the markets and what not.
I’ve usually found that Monday 3pm is the best time to analyse charts. When starting off, i started trading 1 currency and 1 commodity at a time. As the saying goes, “trade smart, not often”.
Given that the Americans held most of the world gold (through globalization, killing, pillaging etc)., the USD became the default currency for gold.
Should you want to carry out an intraday trade, then major pairs are the best as they usually have short movements. Some of the major pairs are as follows:
EUR/USD - Controls 30% of the market movement
GBP/USD
USD/CAD
AUD/USD
USD/JPY
USD/CHF
NZD/CHF
As more liquidity entered the market, this lead to the formation of minor pairs.
The minor pairs have a lot movement and here are some of the most traded minor pairs:
GBP/JPY
GBP/AUD
EUR/JPY
NZD/CAD
AUD/CAD
EUR/CAD
Now let’s talk about brokers. To trade a lot of these currencies and commodities you’ll end up utilizing a broker. Now brokers usually make their money based on ‘spreads’.
The spread represents the difference between the buy and sell price of an asset. The price at which you buy (bid price) is always higher than the price at which you sell (ask price), and the underlying market price will general be in the middle of these two prices.
Trading spreads are implemented by market makers, brokers and other providers to add costs to a trading opportunity, based on supply and demand. Depending on how expensive, volatile and liquid an asset is, the spread will fluctuate along with an assets price and trading volume.
For example, let’s say that an asset has:
A buy (bid) price of 1449.5
A sell (ask) price of 1451.1
The spread = difference between buy and sell price = 1.6 points.
Depending on any potential news, brokers can increase the spread.
The Average Daily Range (ADR), is an indicator that can be used to obtain data on a currency pair’s daily volatility. Traders can use the ADR to visualize potential price action outside the average daily move. When ADR is above average, it means that the daily volatility is higher than usual, which implies that the currency pair may be extending beyond its norm.
Take a look at this link that explains ADR and how it can be used for setting up intraday trades: https://forextraininggroup.com/using-adr-average-daily-range-find-short-term-trading-opportunities/
Essentially Average Daily Range (ADR) shows how much movement has occurred (i.e. each candle being formed). With regards to the minor pairs - they have a high daily range and high spread and with major pairs - low daily range and low spread.