Currency Market Triangulations and Combinations

EUR/USD V EUR/AUD V AUD/USD is one example of a Currency Pair Triangulation. Eliminate EUR from EUR/USD and EUR/AUD then

remainder pairs becomes USD/AUD Vs AUD/USD.

Triangulation trading was most popular from the 1970’s free float to 2009 when traders paid a full price for each lot. The Triangulation advantage and purpose before 2009 was to earn the discrepancy in pips between 2 price locations such as London Vs New York.

They called this arbitrage trading but done through Triangulations. London V New York routinely quoted 2 separate prices for the Ask Vs Bid Side or Buy V Sell. Generally the difference was a few pips but the trade and profit was guaranteed. Currency pairs had to arrange as 3 in order to view possible arrangements to take advantage of an arbitrage trade.

An arbitrage trade could be called a Scalp trade.

Since 2009, based on NFP Rules to pay a spread rather than a flat rate for each lot, the terminology was lost yet the concepts to triangulations are as old as the Bible and will remain for 1000’s of years in the future.

Triangulation depends on the 3 pair arrangement and what pairs a traders wishes to view.

If the arrangement was EUR/AUD, EUR/USD and AUD/USD then eliminate EUR and one views AUD/USD V AUD/USD. This doesn’t work.

If AUD/USD Vs EUR/USD V EUR/AUD is viewed then eliminate EUR and remainder becomes AUD/USD Vs USD/AUD. This works.

How about EUR/USD V AUD/USD V EUR/AUD. Eliminate EUR and remainder becomes USD/AUD Vs AUD/USD. This works.

28 currency pairs as 2 currencies per day factors as 378 combinations.

28 currency pairs as Triangulation or groups of 3 factors to 84.

28 Currency Pairs factored to groups of 4 = 112

 

How triangulation is viewed today is overbought Vs Oversold to 3 currency pairs, Relationship to vital point breaks and possible mis alignments. A mis alignment must align.

 

Brian Twomey

 

EM V G28 and 0 Point V 1 Point Currencies

Both markets are the exact same. Analysts present EM as if its a different market in a far away land when in fact its not true.
The difference between EM and G28 is a Currency Nation Name and exchangerate number.
G28 is the driver to EM Prices.
Certain EM Pairs may or may not move as well as G28 yet influence to G28 remains.
Of 28 Total Currencies, 9 begin with 0 Point which leaves 21 Currencies to begin with 1 Point
Eliminate 6 for AUD and NZD and USDCHF then 2 very special currency pairs exist EURGBP and CADCHF
Both designed to severely contain EUR and  GBP  and USDCAD and Currency crosses.
EUR, and GBP and  CAD represent the entire G28 Market.
Currency Prices are not designed to move because the Currency Market is a self contained market as currency Prices and Pairs are counterbalanced against each other.
0 Point currencies are not designed to trade but to forecast
EURGBP contains EUR and GBP while CADCHF contains USDCAD.
Then GBPUSD V USDCAD alone contains each other.
This stifles EM movements except those EM designed to move as follows:
ZAR, TRY, RON, HUF, PLN and question to where SEK, NOK and MXN fit yet all decent movers.
                   Brian Twomey

EUR/USD V EUR/AUD V AUD/USD

In this currency market Triangular relationship, both EURUSD and AUDUSD Trade above respective vital high/ Low points at 1.1104 and 0.6853 while EURAUD trades below vital 1.6204.

EURAUD at current 1.6142 is deeply oversold while nothing special exists in highly neutral Statistical readings in EURUSD and AUDUSD.

Highly oversold EURAUD is confirmed by deeply overbought AUDEUR. Further confirmed by a AUDEUR noise ratio ready for explosion.

To rectify EURAUD, it must break 1.6204 and EURUSD must Trade higher while AUDUSD must travel lower.

Many Triangular mis matches exists.

For Example, USDJPY Trades above 108.77, EURUSD above 1.1104 and EURJPY above at 120.79.

Either EURUSD and EURJPY must break below or USDJPY must Trade below.

Same for GBPUSD, and GBPJPY and USDJPY.

USDCAD below 1.3207, CADJPY above 82.38 and USDJPY above 108.77 is a correct relationship.

CAD relationships to all Cross pairs for the most are fine.

USDCHF at break below 0.9871 to trade below is correct to EURUSD above 1.1104 but not necessarily correct to EURCHF below 1.0969. A correlation remains at play here.

 

Brian Twomey