If you are a forex speculator, having a currency strength chart at your
disposal just makes sense for trading the foreign exchange. It is a
tool that shows exactly
how an individual currency is doing as measured against its peers. The
substitute for a good currency strength indicator is pouring through
dozens of pair charts trying to figure out which currency is doing
Always set your chart time to at least 4 hours and better still, 8
hours.You can’t see trends with small time periods. This is
not a pair chart. The time refers to the travel across the chart from
left to right. Its all happening in realtime.
When I line up the
strength chart with the pair chart of eur/usd , it doesn’t match. Why?
Price chart versus Strength chart
The strength number represents that currency’s value among all the
pairs contributing to the calculation. When we see the USD strength
line moving up on the strength chart it means the US dollar is active within all the pairs it is measured from. So it may
or may not line up as a representation of any one particular pair.
The strength chart shows the differences in value placed on a currency
by the market participants. It follows the idea behind arbitrage. Many
times a rise in price on one particular pair is not reflected immediately but the strength chart caught it. The others catch up.
The numbers on
your strength chart do not match up with my other currency strength
The unique strength formula goes beyond simple RSI
types of strength freebie meters. I began studying forex data
in 2004. As part of my research into foreign exchange strength
measurement, I knew that an increase in the performance of the USA
dollar within any pair was more important than a similar movement with
the New Zealand or Canadian dollar. The special algorythm accounts for
this difference using a weight for each of the currencies.
When the banks begin purchasing huge amounts of the reserve currency.
(USD), placing the same “weight” measurement as it does for the Swiss
Franc, will not correctly reflect what is happening to
Everything is important when real money is on the line.
The FX4Caster will draw on up to 27 forex pairs to make its
What trading system do I use with it?
The FX4Caster is a trading tool that explodes the win/loss ratio of any
trading system you add it to. All of them can use the readings from a single currency indicator.
What is the strength chart setting to use with five-minute price
Comparing apples and oranges.
Individual Currency strength is displayed differently than price
charts. It’s a line that displays the finest detail and nuances
of a single currency in the foreign exchange market. The chart can be set to show the last 8 hours of movements.
On a pair chart, the data is averaged into time segments.
The Currency strength chart does not average movement over time. It shows
the tiny fluctuations in real time. These little ups and downs in
currency strength can be a vital clue into what is going to
Set your chart up to show at least 8 hours and preferably 10. You do
this in settings tab. Low times distort whats really going on with an
individual currency. You need to know a currencies prior history to see
the patterns that may be forming. Looking at it on a low time period
doesn’t let you see direction or past very well.
The currency strength chart displays from left to right.
This is a great starting tool. Tradetime Software also has the Professional version of AccuStrength Currency strength chart.