I am making this post to sum up my own thoughts.
Okey, so... i guess nothing is purely leading or purely lagging in forex, still, i believe each pairs could be assigned a number of how leading/lagging a pair is. 1 - being absolutely leading and 0 - purely lagging (noone trades it except market makers).
here is an example: take USD/XAU/XAG.
XAU/USD is quite leading; XAG/USD - being somewhere in between and XAU/XAG - very lagging.
Using some logics and some chart observation i have convinced myself that
1) Support and resistance in crosses doesn't work nearly as well as in other two pairs.
2) Once in a trend (up, down or sideways) it tends to stay there for longer. But i think this should relate to larger time frames only, because in short term i would expect a lof of noise because of arbitrage traders.
Some time ago i run into XAU/XAG chart where you can see these extreme differences. Some daily charts are attached to show what i am talking about.
Now... i would like to reach outside of comfort zone and assign such a value for USDINX as well. I have seen quite a lof of support/resistance thing work at EUR/USD on intraday basis, but i also have a feeling that EUR/USD decline that started on 14.09.2012 had something to do with USDINX running into major support zone.
Okey, so... i guess nothing is purely leading or purely lagging in forex, still, i believe each pairs could be assigned a number of how leading/lagging a pair is. 1 - being absolutely leading and 0 - purely lagging (noone trades it except market makers).
here is an example: take USD/XAU/XAG.
XAU/USD is quite leading; XAG/USD - being somewhere in between and XAU/XAG - very lagging.
Using some logics and some chart observation i have convinced myself that
1) Support and resistance in crosses doesn't work nearly as well as in other two pairs.
2) Once in a trend (up, down or sideways) it tends to stay there for longer. But i think this should relate to larger time frames only, because in short term i would expect a lof of noise because of arbitrage traders.
Some time ago i run into XAU/XAG chart where you can see these extreme differences. Some daily charts are attached to show what i am talking about.
Now... i would like to reach outside of comfort zone and assign such a value for USDINX as well. I have seen quite a lof of support/resistance thing work at EUR/USD on intraday basis, but i also have a feeling that EUR/USD decline that started on 14.09.2012 had something to do with USDINX running into major support zone.
Attached Image(s) (click to enlarge)
