SMT Divergence LUMI TRADERS

WHICH PAIR TO CHOOSE FOR TRADING?

SMT Divergence serves as a confirmation tool for identifying
Accumulation/Distribution phases in trading. It is not typically used as an
As traders, we need activity in the markets, volatility is what makes
entry pattern on its own. By observing SMT Divergence, traders can gain
trading easier. The news plays a significant role in contributing to
insights into potential Stop Hunts in the market and make more informed
market activity, so we typically start the trading day by checking the
decisions.
economic calendar.
Symmetrical Correlation Inverse Correlation
Crypto market - (BTC - ETH) Crypto market - (BTC - DXY)

Forex - (EUR - GBP) Forex - (DXY - EUR)

(DXY - USD/XXX) (DXY - XXX/USD)

Indices - (ES - NQ - YM)

LUMI TRADERS LUMI TRADERS

However, it's essential to note that if there's a

Symmetrical Correlation - Bullish Inverse Correlation - Bullish
scheduled news release on the GBP (British
BTC ETH BTC ETH BTC DXY BTC DXY
EUR GBP EUR GBP DXY EUR/USD DXY EUR/USD
Pound), it doesn't automatically imply that
DXY USD/CAD DXY USD/CAD GBPUSD will be more preferable than EURUSD, for
ES NQ ES NQ
example. Market dynamics are influenced by
various factors, and it's crucial to consider
technical analysis, market sentiment, and so on
before making a trading decision.
Symmetrical Correlation - Bearish LUMI TRADERS
Inverse Correlation - Bearish
BTC The logic is that pairs that are closely correlated
BTC
DXY
DXY with each other are likely to move in a
symmetrical manner.
BTC ETH BTC
ETH
However, during the formation of SMT
EUR GBP EUR
DXY USD/CAD DXY
GBP
DXY DXY divergences, one of the pairs will display
USD/CAD
ES NQ ES
NQ
EUR/USD EUR/USD strength or weakness, signaling an approaching
high volatility for that particular pair.
For instance, if ES reaches a new high, while YM
*05:00am to 9:30am – AM Session [SMT Window]. or NQ fails to do so (showing weakness), it
*01:00pm to 03:00pm – PM Session [SMT Window]. ES NQ suggests a potential trading opportunity. In this
scenario, one may consider opening short
positions on YM/NQ.

lumitraders.com

LUMI TRADERS