Tell us about GBP/USD, known as the CABLE.
So the pound is called the base currency and the dollar is called the secondary currency so if you get a rate of 1.25 for example it means its 1.25 of the secondary currency to buy one unit of the currency. The pound against the dollar and the euro against the dollar is the secondary currency.
To make things more complicated, against the Swiss franc and the Japanese yen the dollar is the base currency, so when the dollar goes up against the Japanese yen the graphs go up the page, but when the dollar goes up against the pound the graph goes down the page.
Why is it such a popular pair with traders?
I think it tends to be quite brick and mortar because it can move quite sharply one way or the other. In the London morning it is a big part of the daily volume so it is easy to sell without any effort. In the Eastern session the pound against the dollar is a very small part of the trading and many people feel that when London opens that it hasn‚t got, it has got catching up to do and that‚s part of what‚s called by many people the cable morning.
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What factors affect CABLE?
The big factor is always interest rates, and interest rates in the US are probably going to go down faster than in the UK, and that could have an impact on the GBP going up against the USD. We will see.
Do you get excited when you see your analysis come into play?
ARE YOU INTERESTED IN FOREX?
Oh yes, when my patterns come into play, yes, they’re great and I always get excited.
The self-awareness question
I think one of the most important things you can say to yourself is, do I feel like doing this today? Because there are days when we’re just not there, something’s happened and somebody’s upset you or something’s happened and you’re just not there. Being honest with yourself and saying I’m just not up to it today is a very, very important part of self-awareness.