How to trade the ruble, the euro and the dollar on the stock exchange. Almost on the Moscow Exchange
At the moment in our country there is a reform in the regulation of the FOREX market. So far things are moving slowly. And I think it makes sense to talk about alternative currency trading.
Today I would like to tell novice traders about the peculiarities of working with currency pairs at the Moscow Exchange. In contrast to the FOREX market, the most popular here is dollar/ruble pair. Another important difference - with the pair dollar/ruble you can carry out transactions with the equivalent of $ 1000 or more.
Not a very easy dollar/ruble pair on the Moscow Exchange
[info_block align="right"]And Russians know the dollar/ruble pair very well. Wrong! You know nothing about this pair. [/info_block]
At first sight, this pair seems so simple and understandable, and that is why, when starting exchange trading, many people tend to trade with this instrument. Everybody knows stories about rich street traders, everybody bought currency at least once and at least once tried to profit from it. But often beginners lose their money, because they are not able and/or do not want to compare possibilities of different assets. If they looked around and took a closer look at the instruments of the Moscow Exchange, they would see assets that are easier, better, and more understandable than the dollar/ruble. But alas! They are captive to prejudice.
How could it be? After all, I myself have often said, "Buy what you know? And the Russians know the dollar/ruble pair very well. Wrong! You don't know anything about this pair. In the life of this pair there were a couple or three brightest shocks, which settled on the subcortex of our everyday people, and they try to trade this one-time experience when they come to the stock exchange.
How often do I hear how profitable it is to invest in the dollar for the long term, or how strong the dollar can be in August! Oh, come on, 1998 - I remember, I remember...
Yes, for August 1998, the dollar went up 130%, but for September alone it went up 150%! And which month is more terrible for the ruble?
How to trade the dollar / ruble on the Moscow Exchange?
Let me offer you my opinion on the most popular currency pair at the Moscow Exchange, and you can decide whether to listen to it or not.
1) Decide clearly - why do you want to trade the dollar-ruble? The only, in my opinion, the correct answer for a speculator is to make short-term profits when there are no signals on other assets, or the signal is the easiest on this pair. For investors, the dollar/ruble pair can only be a tool to hedge their savings in ruble deposits, bonds or stocks.
2) Get rid of your preconceptions. The best way is just to turn them off in your head. But that takes incredible willpower. Few people have it. So I collect and analyze statistics related to the myths about the dollar/ruble. So, I have monthly data on how this pair behaved. And I can't be taken in by tales about the strong dollar in summer. But can we calculate, for instance, how our currency pair reacts to statements by Putin or Trump? No! These signals are too heterogeneous and appear chaotically - I will not take them into account in my trading. But even if required, these signals will only affect the size of the position, not the implementation of the trade as a whole.
3) Try to take into account in your analysis not only the dynamics of the dollar/ruble pairYou should approach your analysis with a multi-factor approach. Look at how oil, gold, world and Russian indices, the euro/dollar pair behave. The more "barometers" you have, the more accurate your measurements will be.
4) Familiarize yourself with the pitfalls of bidding. Betting on changes in currency pairs on the Moscow Exchange can be done through currency market instruments or through futures contracts. On the currency section, there are difficulties with setting "stops" when the contracts change from TOM (settlement tomorrow) to TOD (settlement today). This market is more suitable for a mechanical trading system that takes this factor into account. On the futures market, few people know the difference between the value of the contract and GO (security deposit, "collateral for the transaction").
Euro / ruble on the Moscow Exchange
[info_block align="right"]If you have set yourself a strategic task to work with the euro/ruble pair, then I would look for the "Grail" on not futures, but on contracts of the currency market of the Moscow Exchange, and if possible on timeframes less than an hour. [/info_block].
The second most popular instrument on the Moscow Exchange is euro/rublewhich is logical, because the contract is "trailer" behind the dollar/ruble pair.
Despite almost seven years of experience in active speculation on the futures market, I do not understand how this pair can be traded in the form of futures. Apparently, the "youth" of the pair makes itself felt. In any case, the signals of the classical technical analysis on the daily and hourly charts always look very suspicious. They seem to be there, but with distortions, as on "second echelon" shares.
If you set yourself the strategic task to work on the EUR/USD pair, then I would look for the "Grail" not on futures, but on the contracts of the currency market of the Moscow Exchange, and if possible on timeframes less than one hour. For me personally, everything that is "below" an hour - is already working with indicators, trading advisors, or ideally with a mechanical trading system. But in this case we need to add to the analysis the behavior of the euro/dollar pair, and macroeconomic news.
How to trade the euro / dollar on the Moscow Exchange
The world's most popular euro/dollar pair in the form of a futures contract, ranks about tenth in liquidity in the list of futures and currency market contracts of the Moscow Exchange. But, in my opinion, it should be referred to by those who are not satisfied with the cost of the FOREX contract, which makes trading without "leverage" unaffordable for small accounts.
Given the trading time of the Russian contract, which is different from the world, the small volatility of this contract and the fact that the financial result will still come to you through the ruble, I think that this contract is for "fans", for beginners trading this instrument brings artificial, unnecessary difficulties.
I do not know how educational my article is. Rather, it is a user's view of the Moscow Exchange currency and futures market instruments. But I think I have set the first accents for your safe trading.
The choice is up to you!