Trade Strong vs. Weak Economies with Currency Crosses 💪😓
When strong economic data comes out of Australia, your first instinct might be to buy AUD/USD.
But what if the U.S. also releases strong economic numbers around the same time?
In that case, AUD/USD might not move much — the strength of both currencies could cancel each other out, leading to flat price action.
Enter Currency Crosses — Your Secret Weapon 🕵️♂️
Here’s where currency crosses come to the rescue.
Instead of pairing AUD with another strong currency like the USD, what if you match it against a weaker economy?
Let’s say you check the news and see that Japan’s economic outlook is looking shaky.
Now you’re thinking, "Why not go long on AUD/JPY?"
You’ve got a strong currency (AUD) vs. a weak one (JPY). That’s the kind of mismatch forex traders love.
AUD/JPY vs. AUD/USD
Look at the chart above — notice how AUD/JPY is performing better than AUD/USD?
That’s because you’ve paired strength against weakness, rather than strength against strength.
It’s All About Relative Strength
You’re not limited to AUD/USD or AUD/JPY. You can compare AUD with:
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EUR
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GBP
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CAD, and more.
Find the weakest of the bunch and trade accordingly.
It’s not bullying — it’s just smart trading. (Okay… maybe a little bullying. But we’re okay with that at the School of Pipsology 😉.)
Bottom Line
Currency crosses let you:
✅ Skip the U.S. dollar
✅ Match strong economies against weak ones
✅ Find better trend opportunities
It’s all about spotting imbalances and turning them into trading profits. So go ahead, be the matchmaker of the forex world — pair the best with the worst and watch the magic happen. 🪄