? Currency Strength ?
?So what is currency strength??
?Currency strength provides a useful way to make sense of price moves in the forex market. It takes advantage of the price correlation between various forex pairs. Currency strength is measured for 8?currencies ????(USD, JPY, EUR, GBP, AUD, NZD, CHF, CAD) and is reported on a scale of 0 (weakest) to 10 (strongest).
?How is it calculated??
?Currency strength is calculated by performing real-time calculations on a large group of forex pairs. It involves the measurement of relative price moves over various sampling time-windows using our proprietary algorithm. All this heavy number crunching is done by our cloud servers in real-time, and is then delivered to your screen with very low latency.
ℹ️How can currency strength be used for trading?ℹ️
Typically a trader would look for strength or weakness on a particular currency/time-frame, and then focus their attention on trade setups involving related forex pairs.
〽️Currency strength can also be used to quickly identify the cause of a large move on a forex pair. So for example, if GBP/USD is trending upwards, currency strength would immediately tell you whether the move was due to generalised GBP strength or USD weakness. If it was due to USD weakness, then you’d look for trade opportunities on other USD forex pairs.?
?Currency Strength Charting?
There a 2 types of charts – line-charts and bar-charts.?
?Currency strength line charts looks pretty much like a normal forex line-chart except that the vertical axis is currency strength rather than price. They’re used to identify currency strength trends. A chart can display up to 8 different currency strength’s at once, and the time-frame measurement interval is selectable. You can open as many charts as you want, resize them, scroll and zoom, just like any normal forex chart.?