Should we start trading minor currencies because of the excessive liquidity?

[Robert]

There are many Forex brokers out there and thier number is continuing to grow. More and more marekt players enter the FX markets as well as the increased amount of sophisticated trading software (known as trading robots or expert advisors in the MT4). My question is, if there are too many traders in one pair (take EUR/USD as an example) perhaps it would be better to trade in FX pairs with lower liquidity such as AUD/CHF, GBP/CAD, USD/SEK, EUR/TRY etc. Because of the high liquidity stop hunting is inevitble. More positions, more stop hunting and 'suspicious' spikes. Or perhaps it is better to move to commodities such as sugar, corn, orange juice, live cattle, soybean etc. where stop hunting is less active? What do you think? Please share your views on the matter.

 

[TheLastBear]

It comes down to your preference and what you like, nothing more and nothing less.

 

[Robert]

It comes down to your preference and what you like, nothing more and nothing less.

This is not about prefereance. Around 40% of trades in the marekt are done by trading robots that cause iregular movements in FX price (google US flash crash for example). They are concentrated as the major pairs because of the high liquidity. Why not go for minor currencies where you as trader are less exposed to this 'sofware mess?'

 

[Rob Taylor]

This is what trading is all about Robert. Liquidity is good for trading not bad. If you are having trouble making money in high liquidity pairs then you will have more problems with low liquidity pairs as they are open to more manipulation. Your spread will also be larger on low liquidity pairs.

 

[TheLastBear]

This is not about prefereance. Around 40% of trades in the marekt are done by trading robots that cause iregular movements in FX price (google US flash crash for example). They are concentrated as the major pairs because of the high liquidity. Why not go for minor currencies where you as trader are less exposed to this 'sofware mess?'

I do not want to make a judgement about you as a trader, but having been in the business myself for over a decade I think you tend to not be on the profitable site and earn a living from it.

As mentioned, you want liquidity. I do not need to google the flash crash as I was trading through it. You may not have a strategy that works and blame your mistakes on automated trading, but that is not the case otherwise everyone would struggle and not only a majority of retail traders.

May I suggest that you adjust your strategy and the way you approach the markets?

 

[candle7779]

This is not about prefereance. Around 40% of trades in the marekt are done by trading robots that cause iregular movements in FX price (google US flash crash for example). They are concentrated as the major pairs because of the high liquidity. Why not go for minor currencies where you as trader are less exposed to this 'sofware mess?'

Well it seems to me rather reasonable thought. Does anybody have such experience. I prefer trading with EURUSD and GBPUSD but for the last time I think about NZDUSD.