One of the most frustrating aspects of investing is when you nail your direction of a currency set of two but the timing is off of and you get stopped out and about before the big move takes place.
This hurts you two fold:
- You have a realized loss when you get ceased out.
- Many times, you are subsequently gun shy and don’testosterone levels re-enter the trade, missing the eventual move.
Can you relate with this?
Here‘s an illustration of ways our Currency Strength Indicator not only tells you which currencies to pair together to the highest probability trade setup (based on strongest VS weakest currency) but also how to which it perfectly so that you grab the earnings for your account and don’testosterone levels occur unnecessary losses.
First thing to notice is which currencies NOT to trade. Every money except the AUD (orange range at the top) and the JPY (yellow brand at the bottom) are trading back and forth and near the dotted actually zero line. With a quick glance, you can avoid any twos with these currencies in them.
So, the best by far is the AUD (top) along with the weakest is the JPY (bottom). Giving you a clear pair to help trade based on strength Versus weakness which gives you the greatest probability trade set up at the present time.
However, we can also measure impetus in the market which tells us once this pair is most likely to move a lot. What we look for on the gauge is a very sharp line for the far right moving up and also down. Here is an example:
When you appear again at the sideways structure of the AUD and JPY lines for IMAGE 1 above, you recognize there is no current momentum. Which means that, we must wait until that is provide. Let’s look at the chart to determine this play out.
Our indicator exhibiting no momentum corresponds to the actual sideways channel I have notable in red. So, even if you had the right trade, meaning you’ng identified the right pair and direction, you were still almost certainly stopped out especially if you entered near the top of the channel. This is probably a situation you are all too aware of.
On the flip side, once our indication started showing momentum joining the market, you can see that price shattered through the channel to the upside as we expected and elevated about 100 pips. Even if you were being late and waited for the confirmation from our indicator, you can have entered where I proclaimed the entry above plus grabbed 34 pips at the top of a move.
Our Currency Strength Pointer is a free tool to help you pick which pairs to avoid, which will to trade and also ascertain exactly when to enter.
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