Olymp Trade has wide financial instruments offer. Digital options include, among others, commodities, cryptocurrencies, stocks and currency pairs. The most popular seems to be currencies. 92% of customers are choosing them.
Such a situation can be explained in a few ways. First, currency pairs have a higher return, 80% or more. Second, there are plenty to choose from which gives more opportunities to trade. Also, currency pairs are less volatile than cryptocurrencies, for example, which makes trading easier. And in comparison to commodities and stocks, the price movements are more frequent, thus, more possible transactions per day.
Today’s guide is something for you if you want to trade currencies or you just want to get some information on this topic. Let’s get started.
- 1 Choosing the optimal currency pair at Olymp Trade
Choosing the optimal currency pair at Olymp Trade
You should be aware that many currencies are sensitive to news releases. At the time of the announcement, the market can be more volatile. It is recommended not to trade during this time, particularly if you find it difficult to cope with high volatility.
How to stay away from trading in high volatility times
The first step you should take if you do not want to trade when the news is released is to learn when the various markets open on the basis of your time zone. For instance, customers in Vietnam can trade Asian and European markets in their daytime, but the North American market is close then. It will be open when there is night in Vietnam.
Now, you have to learn when the news is usually released. For most markets, the morning is the time for the news. Keep in mind, though, that morning in America is late evening in Vietnam, morning in Great Britain will be afternoon.
This knowledge will help you avoid the news releases. As in the examples above, you may trade USDGBP in the morning and JPYAUD in the evening.
The question is, is it better to trade multiple currency pairs to avoid high market volatility caused by the news releases?
Stick to one currency pair
I realise, the diversity of currencies at Olymp Trade encourages to trade many of them at a different time of the day. But it is more reasonable to focus on one pair.
Learn your currency pair inside out
Knowledge is the key to success. It is no different in trading. Get to know more than 20 currency pairs can be an impossible challenge. But if you choose one currency pair, the time you need to know it well will be much shorter.
So consider which currency pair will be best and stick to it. Once you learned a lot about it, you could transfer this knowledge to the real account and start making money.
Following the steps, I have earlier described, to avoid trading during the news releases, you will get an accurate time window to do your trading. There will be no need to spend all day at the computer desk.
Single trade open
Imagine you are opening the positions for the multiple currency pairs like EURUSD, JPYAUD, AUDEUR and AUDUSD simultaneously. It will be really hard to choose one to look at more closely. Naturally, you would like to profit from all your trades. But this variety makes it very difficult to focus on good entry signals. What will you do if you lose all transactions? It will cost you a fortune!
When trading one currency pair, you can relax more. Take off the tension. Follow the price chart carefully and analyse what is happening. Sure, you may still lose the trade, but after that, you take time to review the situation on the market so you can behave differently in the future. Moreover, with one pair only there is no need to know all the strategies that exist. You will use some limited number of indicators. So you save time and boost the chances of making a profit.
Reduce psychological stress
Let’s go back to the example above where you were opening trades for multiple currency pairs at once. Can you imagine the pressure it gives you?
Emotions are not good advisors. When there is a high pressure, they will finally take control over. You will experience greed, fear, anxiety, you will lose concentration. And this is a straight path to the failure.
On the other hand, if you stick to one currency pair only, the stress will be reduced to a minimum. It will be easier to concentrate on your trades and not to worry too much about huge sums you could lose if you hold many positions open at the same time.
Trading currency pairs on the Olymp Trade platform
You will find many financial instruments to choose from on the Olymp Trade platform. Their offer includes a wide range of assets.
Currency pair choice is a very basic decision you will have to make while trading at Olymp Trade. This is also quite a personal decision. But the choice will be easier if you follow the steps described in this article.
Do not forget about patience
Trading is often about waiting. Waiting until you get to know the instrument, the indicators. Waiting until they will expose a good entry point. And it can happen that one day you will see many opportunities to trade, and the other just one or two. Do not worry, because if you follow your plan, those few will bring you profit. And even a small profit is better than losing.
Consider trading strategies that are applicable to the trending market and the ranging market as well. This will ensure more chances to open profitable transactions during a day.
I would be glad to hear about your experiences, about the currency pairs you like, the strategies you use. Kindly use the comments section. You will find it further down the site.
Wish you profitable trading!
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