What is the Opposite Pairs Forex Trading Strategy | Daily Up To $100
The Opposite Pairs Forex Trading Strategy is an effective and balanced Forex Trading Strategy that employs two negatively correlated currency pairs simultaneously. Rather than relying on one direction only, Opposite Pairs allow Traders to balance out the risk and create more consistent daily profits. The movement of one of the currency pairs upwards normally would be offset by the downward movement of another, allowing for better drawdown control and determining a trader’s ability to make more accurate trades overall.
Create Demo Account Best Broker
Before trading with live currency pairs, it is strongly encouraged to practice implementing the Opposite Pairs Strategy on a Demo Trading Account first; this gives you an opportunity to try it out without putting your money at risk.
An ideal broker like Exness and HFM (HoTForex), Avfx Capital, for using a Demo Account would have:
Spreads Closest Together for the Major Currency Pairs
Quick Execution of Orders
Unlimited Free Demo Accounts
Trustworthy Platforms Utilizing MT4 & MT5
By practicing in a demo account, you learn how pairs behave, correlate, and when you should enter trades.
What is Opposite Pairs Forex Trading Strategy
Opposite Pairs Trading is taking advantage of the two currency pairs that normally move in opposite directions, for example:
EUR/USD and USD/CHF
GBP/USD and USD/JPY
If the US dollar goes up in value, the first currency pair will go down, meaning your position on that side will increase as your other pair goes down. This opposite move gives traders an opportunity to hedge their positions and lessen their overall risk when using a specific Forex Trading Strategy.
Bullish Forex Trading Strategy Opposite Pairs
In a strong bullish formation,
Identify one currency pair that is trending strongly bullish
Confirm that its opposite pair is exhibiting a weak or bearish structure
Buy the bullish currency pair
Use technical analysis such as support and resistance levels, trendlines, or moving averages
This is an opportunity for traders to take advantage of the bullish trend with the additional benefit of being able to keep their risk managed through correlation.
Bearish Forex Trading Strategy Opposite Pairs
Look for a currency pair with a long-term bearish trend.
Then find a currency pair that is trending up against the first currency.
By entering a short trade on the bearish pair, you are taking advantage of the trend of the currency pair that you entered long on.
Use resistance levels, Fib retracement for confirmation of your short trade.
This is especially useful during a strong trending market or session.
Best Timeframes Forex Trading Strategy
The Opposite Pairs Forex Trading Strategy performs optimally on the following timeframes:
M15 for intra-day (day) trading
M30 for stable intra-day setups
H1 for signals that are more reliable and hence, safer to trade with.
More time frames usually reduce the number of false signals and provide better accuracy, especially for those who are new to the market.
Common Mistakes in Forex Trading Strategy
The strategy has been unsuccessful for many traders because they are:
Trading more pairs than they should.
Not paying attention to how strongly pairs correlate with one another.
Using too much leverage for their accounts.
Trading with a high volume of trades during low-volume periods.
Not placing stop losses.
To be a consistently successful trader, it is critical to avoid the above mistakes.
Pro Tips Forex Trading Strategy
To achieve superior trading outcomes:
Check correlations prior to entry into the market
Utilize appropriate risk management (1-2% of total capital per trade)
Only place trades during high-volume periods
Utilize simple technical indicators in conjunction with other methods (e.g., moving averages)
Trade only with one or two pairs that typically move in opposite directions
The keys to successful trading are discipline and patience.
Final Thoughts
The Opposite Pairs Forex Trading Method is a very effective Forex Trading strategy that offers beginners an opportunity to trade Forex without too much difficulty. With the right focus on balance, correlation, and risk management, the Opposite Pairs Forex Trading Strategy can generate consistent and stable daily profits for traders who are disciplined in their trading approach. Achieving success through this method of trading requires disciplined money management, patience, and consistency rather than chasing quick profits.