Vast majority of Currency market price trading among 28 currency pairs is found in the dead center among relationships between EUR, GBP and CAD. To include cross pairs among the big 3 then 16 currency pairs are not only intertwined but influence remainder 12 currency pairs to complete all 28.
The import to 28 currency pairs on a larger scale is this G28 market influences and drives all EM currency pairs as EM and G28 are deeply linked and not separate entities. Analysts present EM currency pairs as if its a far away land against no relevance to G28 when in reality, its not true.
EUR/GBP and CAD/CHF are 2 most vital and highly special currency pairs to either trade alongside or influence the vast majority of currency pairs associated to its price and to include EUR, GBP and CAD.
To re- arrange EUR/GBP and CAD/CHF then 20 currency pair combinations exist between both pairs. To understand the 20 currency pair influence to all 28 then total 28 currency market combinations exists 378 or as groups of 3 for Triangulations factors to 84 currency pairs and as grouped by 4 currencies then 112 pairs exist.
The purpose to EUR/GBP and CAD/CHF for trading purpose is to forecast its price to other currency pairs but not necessarily to trade because neither pair moves significantly enough to bother trading.
What forecast means on a larger scale is exchange rates predict perfectly exchange rate entries and targets by use of a $5 calculator. This eliminates math and surely dinosaur indicators, charts, graphs, stops and all means to forecast exchange rates. Duetsch bank latest forecasts are based on the old exchange rate forecast formula in Purchasing Power Parities. This is not needed nor would I trust the forecasts.
Non movement to EUR/GBP and CAD/CHF performs its overall currency market function as not only the link to other currency pairs but to prevent price movements. EUR/GBP and CAD/CHF performs a stable influence to overall currency prices so prices don't trade off kilter or worse, out of control.
EUR/GBP at close 0.8513 only association is to AUD/CAD and NZD/CAD by eyeball but EUR/GBP as 1.1 reciprocal influences EUR/USD, CAD/USD, CHF/JPY, CAD/NZD, CAD/AUD, CHF/EUR. Then EUR/GBP is supported by CHF/GBP at 0.78, USD/GBP at 0.76 and GBP/JPY at 0.70.
CAD/CHF at 0.7475 close only association is to far away prices in AUD/CAD and NZD/CAD but 1.33 reciprocal forms a different picture as views now influence USD/CAD, GBP/USD, GBP/JPY, GBP/CHF.
CAD/CHF long term target is located at 0.7613 or 1.3135. What is 1.3135 means USD/CAD, GBP/USD, GBP/CHF or a range to about 10 currency pairs.
Forecast 1 currency price to another currency price then ability exists to forecast and trade every currency pair weekly and long term quite easily.
Problem this week in currency markets is GBP prices are correct while remainder 18 currency pairs factors as either complete dead or erratic prices. EUR/GBP is correct.
Weekly Trades: CAD/CHF, EUR/GBP, USD/CHF and GBP/USD
Long 0.7452 and 0.7458 to target 0.7471. Long above 0.7478 to target 0.7504.
Long 0.8502 and 0.8481 to target 0.8581. Long above 0.8601 to target 0.8679.
Long 0.8795 and 0.9805 to target 0.9868. Long above 0.9875 to target 0.9906.
Short 1.3145 and 1.3202 to target 1.2944. Must cross 1.3088, 1.3031 and 1.2974.
Short below 1.2916 to target 1.2802. Must cross 1.2859 and 1.2831.
Trading currencies and other financial instruments carries a degree of loss and possible loss of entire investments. Please managed your own risks, stop loss, and margins requirements.