Why would a Trader Need Currency Strength Meter Indicator anyway?
You’ll be surprised to learn that most traders, even those who have had a bit of success trading have done so through trial and error and are not truly certain of what works and what doesn’t work.
Even when they are 60% sure.. they are not sure why their strategies work
Forex Traders Mistake
The first thing a trader is introduced to is the main pairs and the minor pairs.. So you’ll hear a trader say.. I prefer to trade EURGBP during the London session or EURUSD during the Newyork session.. and then followed by rumblings on why one would need to trade certain pairs on given sessions..
The right way to look at it is to understand Currency Pairs are NOT Markets..
On the contrary a single currency is a market of its own.
In layman’s terms.. If seller A has a stock of Tomatoes and Seller B has a stock of Onions
Then Seller A has stocked tomatoes in a market of tomatoes
Seller B has stocked onions in a market of Onions
If seller A and B decide to do barter trade.. the we would pair onions against tomatoes..
now that would be a pair of two markets..
we would have to price the tomatoes and price the onions as independent products, such that we can come up with a formula where for example two onions equate three tomatoes.
When there is over supply of onions then we can move to one onion for one tomato
where there is inadequate supply of onions then we can have one onion for five tomatoes
when we are trading onions for tomatoes we can say we are trading the markets..
The same happens with currency trading.. we trade markets.. where two markets are paired to have a currency pair.
The Best Markets to Trade
Now that we have established a currency is a market, which markets when at odd give the best profit?
Based on our earlier example, you get more tomatoes when there is LOW supply of onions and Over supply of tomatoes such that One Onion can trade for Eight tomatoes.
To get the best pairs to trade. You therefore need to match the Strongest currency against the weakest currency.
For a moment forget, all the theories you’ve heard about trending pairs and so on.
Now think of an Upward Trend as a Weak base currency against a strong currency
A Downward Trend therefore means we have a strong base currency against a weak currency.
Currency Strength Meter Indicator
Imagine a situation where you are able to Identify a strong currency and a weak one. when you match them you get a trending pair and as sure as death and taxes you can enter a trade when you are 99.9% certain that you will win.
Now you don’t have to wish again.. because your wish is now real and right before you: Currency Strength Indicator
In the image above derived from Currency Strength Meter Indicator dashboard the Yellow line is heading upwards while the Blue line is heading downwards
This means the currency represented by yellow line is strengthening and the currency represented by the blue line is weakening. This makes it a perfect pair to trade.
From the Key on top of image. Yellow= JPY and Blue= USD
This means USDJPY is the pair to trade on M15 time frame.
USD (weakening) as the base currency and JPY (strengthening) as the counter currency, means that One USD has lesser JPY equivalent and the trend should be downwards. Now this is how an M15 chart looks like
As you can see, there is a downward trend since 10 bars ago.. and a general downward trend for nearly 75% of the latest candles..
Currency Strength Meter Indicator is a good tool for traders to help confirm trends in respective pairs and a trader can decide what pairs to trade for profit.
Am sure you’ll find this trading tool enjoyable download your copy now before its take down. Click Here
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