Convergence/Divergence too big, how to minimize losss (rescue positions) - suggestions needed
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Hello traders,
My trading is based on Convergence/Divergence of 2 currency pairs.
Buy one pair and sell the other pair. The third currency is used as an indicator.
I usually trade AUD/USD and AUD/CAD, the USD/CAD I use as an indicator to make a decision.
Sometimes the Convergence or Divergence gets quite large and the Floating P/L grows negative quite high and I have to wait a very long time for the Convergence/Divergence to reverse.
I noticed that many traders use and discus this strategy.
My Question to experienced traders of this strategy:
Does anybody have an idea or suggestion how to rescue the widening loosing Floating P/L?
What to do???
I tried to open more positions with other currency pairs that have common currency (eg: AUD/JPY). That usually works, but for this, one has to have a very large account balance.
Waiting for suggestions and wishing you all profitable trading.
John