FxTaTrader


Forex Technical Analysis based on experience and research.

Sunday, February 26, 2017

Forex Strength and Comparison for Week 9 / 2017

In the Currency Strength table the JPY was the strongest currency while the EUR was the weakest. The NZD gained 2 points last weekAll the other Currencies remained around the level of the previous week with a maximum difference of just 1 point.



______________________________________

13 Weeks Currency Score Strength

The 13 Weeks Currency Strength and the 13 Weeks Average are provided here below. This data and the "13 weeks Currency Classification" are considered for deciding on the preferred range. Because it is not ideal nor desired to change the range for a currency every single week, we perform several checks to avoid this.
  1. First of all the strength over a period of the last 13 weeks is considered. See each row for more information.
  2. Next the 13 weeks average is considered, see the last row called "Avg. 13 wks."
  3. The number of weeks that a currency was stronger than another currency can also be considered.
  4. The Technical Analysis (TA) Charts for each Time Frame could also be consulted.


For analyzing the best pairs to trade looking from a longer term perspective the last 13 weeks Currency Classification can be used in support.
This was updated on 12 February 2017 and is provided here for reference purposes:
Strong: USD, NZD, CAD. The preferred range is from 6 to 8.
Neutral: CHF, AUD. The preferred range is from 4 to 5.
Weak: JPY, EUR, GBP. The preferred range is from 1 to 3.

When looking at the Average 13 wks. Score the CAD is the strongest of all while the EUR remains the weakest. The currencies are grouped together around a level which makes clear to what classification they fit best.For some currencies this may not be very clear, a good example at the moment is the AUD being a Neutral currency but having an Average 13 wks. score of 5,3077 being between the Strong and Neutral currencies.
This currency is gaining a lot of strength in the last 3 weeks and is clearly the strongest of the Neutral currencies, which are the CHF and AUD.

Another currency that is gaining a lot of strength is the JPY with an Average 13 wks. score of 3,3846 being between the Neutral and Weak currencies.


_____________________________________

Classification review

The JPY is gaining strength lately and seems to be bottoming. It had a Score of 5 in week 3 (15-1-2017). After that it went lower again but in the last 4 weeks the lowest Score was 4 and it is currently at 8. It was in the last 2 weeks in the range of the Stronger currencies and as can be seen in the chart below it has a lot of momentum. The USD seems the weakest of the stronger currencies and together with the CAD it lost strength last week.Below you can see the Weekly Currency Score Chart with the 6 months data as a reference.






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Currency Score Comparison


"Comparison table" and the "Ranking and Rating list"
The Forex Currency Comparison Table compares each currency with its counterpart based on the Currency Score. For more information about the currency Score of this week you can read the article "Forex Ranking, Rating and Score" which is published every week together with this article.
By using the comparison table directly below you can get a view without the volatility and statistics as opposed to the "Ranking and Rating list". Only the strength of each currency against the counterparts is analyzed by using the Technical analysis charts of the 4 Time Frames that are also used for the "Ranking and Rating List".
The information from the Comparison Table is the source for calculating the "Ranking and Rating List" where this list additionally uses the volatility and statistics for creating the best and worst performer in the list from number 1 to 28.




"Comparison table" and the "Currency Score Chart"
The additional value of this table compared to the Currency Score table is that the Comparison Table compares the strength between the currencies of each pair. By subtracting the strength of the weaker currency from the stronger currency we have a way to compare each pair combination.
The comparison table provides a way to compare currencies from a longer term perspective of 13 weeks and also simultaneously taking the current trend into account. By coloring the currencies in the X and Y axis according to their Classification we can show what the best combinations are. In doing this we apply 2 rules to make it clearer.
  1. First of all only better-classified currencies in combination with weaker classified currencies are "Approved" when there is a Currency Score difference of at least 1 in the current week.
  2. The only exception is when 2 currencies are similarly classified but the Currency Score difference is equal to or more than 4.
  3. It means that each currency should be as far apart from each other as possible in the range from 1 to 8. The classification of the currencies in question may change in the longer term. By using the difference of 4 which is exact at the half of the range it seems a safe approach for trading 2 currencies which are similarly classified.
  4. Even though currencies may be in the same classification a currency may be in a weaker/stronger period and may even change its classification in the future. See the current classification for the coming period at the beginning of this article.



______________________________________

Putting the pieces together

Based on the last "13 Weeks currency classification" and the "Currency Comparison Table" the most interesting currencies for going long seem to be the:
AUD, NZD and CAD
.
These are Strong or Neutral currencies from a longer term perspective when looking at the last "13 Weeks currency classification".

For going short the same analysis can be done and the following currencies seem to fit best:
EUR, GBP and CHF.
These are Weak or Neutral currencies from a longer term perspective.

Currencies with a high deviation seem less interesting to trade because they are less predictable. A good example at the moment is/are e.g. the:
AUD and JPY.

Some of the pairs in the "Currency Comparison Table" comply for a longer term trade based on the Technical Analysis (TA) of the Daily and Weekly chart. For the coming week these seem to be: GBP/JPY, GBP/AUD, EUR/NZD, GBP/NZD, GBP/CAD and AUD/CHF.





______________________________________

Besides this article I also use the Forex "Ranking, Rating and Score" which is also available once a week on my blog. In the article "Ranking, Rating and Score" we look in more detail at the absolute position of the currencies and pairs.

It is recommended to read the page "Currency score explained", "Introduction to the FxTaTrader Forex Models" and "Statistics and Probabilities" for a better understanding of the article. If you would like to use this article then mention the source by providing the URL FxTaTrader.com or the direct link to this article. Good luck in the coming week.



______________________________________

DISCLAIMER: The articles are my personal opinion, not recommendations, FX trading is risky and not suitable for everyone.The content is for educational purposes only and is aimed solely for the use by ‘experienced’ traders in the FOREX market as the contents are intended to be understood by professional users who are fully aware of the inherent risks in forex trading. The content is for 'Forex Trading Journal' purpose only. Nothing should be construed as a recommendation to purchase any financial instruments. The choice and risk are always yours. Thank you.

Forex Ranking, Rating and Score for Week 9 / 2017

The Top 10 of the Ranking and Rating list for the coming week shows the following stronger currencies being well represented for going long: AUD(3X) with the JPY(3X) followed by the NZD(2X) with the CAD(2X). The weaker currencies are the EUR(4X) with the GBP(4X) followed by the CHF(2X).
A nice combination for coming week may be e.g:
  • GBP/JPY with the  EUR/NZD
  • EUR/JPY with the GBP/AUD
  • EUR/AUD with the GBP/NZD
Some of the pairs in the list comply for a longer term trade based on the Technical Analysis (TA) of the Daily and Weekly chart. For the coming week, these seem to be: GBP/JPY, GBP/AUD, EUR/NZD, GBP/NZD, GBP/CAD and AUD/CHF. For more details read both of my articles where the relevant Charts and Tables are provided.



______________________________________

Ranking and Rating list

Analysis based on TA charts for all the major currency pairs. Good luck to all. No advice, just info. Every week the Forex ranking rating list will be prepared for the weekend. All the relevant Time Frames will be analyzed and the ATR and Pip value will be set.





______________________________________

For analyzing the best pairs to trade looking from a longer-term perspective the last 13 weeks Currency Classification can be used in support.
This was updated on 12 February 2017 and is provided here for reference purposes:
Strong: USD, NZD, CAD. The preferred range is from 6 to 8.
Neutral: CHF, AUD. The preferred range is from 4 to 5.
Weak: JPY, EUR, GBP. The preferred range is from 1 to 3.

When comparing the 13 weeks Currency Classification with the pairs mentioned in the Ranking List above some would then become less interesting. On the other hand, these pairs are at the top of the list partly also because of their volatility. It seems best to take positions for a short period then and take advantage of the high price movements.
With the FxTaTrader Strategy, these pairs are not traded because these would be trades in the 4 Hour chart or in a lower Time Frame. Nevertheless, they may offer good chances for the short term trader.




______________________________________

Currency Score Chart

The Currency Score analysis is one of the parameters used for the Ranking and Rating list which is published also in this article. The Currency Score is my analysis on the 8 major currencies based on the technical analysis charts using the MACD and Ichimoku indicator on 4 Time Frames: the monthly, weekly, daily and 4 hours. The result of the technical analysis is the screenshot here below.



When comparing the 13 weeks Currency Classification with the recent Currency Score, as provided in the image above, we can determine the deviations. In the article "Forex Strength and Comparison" this is analyzed in more detail. Currencies with a high deviation seem less interesting to trade because they are less predictable. A good example at the moment is/are e.g. the AUD and JPY. Unless a clear opportunity based on the longer term is shown it seems best to be avoided.


______________________________________

Besides this article I also use the Forex "Strength and Comparison" which is also available once a week on my blog. In that article we look in more detail at the relative position of the currencies and pairs. We will look in more detail at the interesting pairs from a longer term perspective for trading in the Daily and Weekly chart. We will use the information from this article, "Ranking, Rating and Score", and analyze it further in more detail.

It is recommended to read the page "Currency score explained", "Introduction to the FxTaTrader Forex Models" and "Statistics and Probabilities" for a better understanding of the article. If you would like to use this article then mention the source by providing the URL FxTaTrader.com or the direct link to this article. Good luck in the coming week.


______________________________________

DISCLAIMER: The articles are my personal opinion, not recommendations, FX trading is risky and not suitable for everyone.The content is for educational purposes only and is aimed solely for the use by ‘experienced’ traders in the FOREX market as the contents are intended to be understood by professional users who are fully aware of the inherent risks in forex trading. The content is for 'Forex Trading Journal' purpose only. Nothing should be construed as a recommendation to purchase any financial instruments. The choice and risk are always yours. Thank you.

Sunday, February 19, 2017

Forex Strength and Comparison for Week 8 / 2017

In the Currency Strength table the AUD was again the strongest currency while the GBP was the weakest. The JPY gained 3 points last weekAll the other Currencies remained around the level of the previous week with a maximum difference of just 1 point.



______________________________________

13 Weeks Currency Score Strength

The 13 Weeks Currency Strength and the 13 Weeks Average are provided here below. This data and the "13 weeks Currency Classification" are considered for deciding on the preferred range. Because it is not ideal nor desired to change the range for a currency every single week, we perform several checks to avoid this.
  1. First of all the strength over a period of the last 13 weeks is considered. See each row for more information.
  2. Next the 13 weeks average is considered, see the last row called "Avg. 13 wks."
  3. The number of weeks that a currency was stronger than another currency can also be considered.
  4. The Technical Analysis (TA) Charts for each Time Frame could also be consulted.


For analyzing the best pairs to trade looking from a longer term perspective the last 13 weeks Currency Classification can be used in support.
This was updated on 12 February 2017 and is provided here for reference purposes:
Strong: USD, NZD, CAD. The preferred range is from 6 to 8.
Neutral: CHF, AUD. The preferred range is from 4 to 5.
Weak: JPY, EUR, GBP. The preferred range is from 1 to 3.

When looking at the Average 13 wks. Score the USD remains the strongest of all while the EUR remains the weakest. The currencies are grouped together around a level which makes clear to what classification they fit best.For some currencies this may not be very clear, a good example at the moment is the AUD being a Neutral currency but having an Average 13 wks. score of 5,2308 being between the Strong and Neutral currencies.
This currency is gaining a lot of strength in the last 3 weeks and is clearly the strongest of the Neutral currencies, which are the CHF and AUD.




______________________________________

The Weak Currencies

The 
JPY is gaining strength lately and seems to be bottoming. It had a Score of 5 in week 3. After that it went lower again but in the last 3 weeks the lowest Score was 4 and it is currently at 7. The EUR and GBP clearly remain very weak. The JPY is the strongest currency among the Weak currencies with an Average 13 wks. Score of 2,9231. Below you can see the Weekly Currency Score Chart with the 6 months data as a reference.





_____________________________________

Currency Score Comparison

"Comparison table" and the "Ranking and Rating list"
The Forex Currency Comparison Table compares each currency with its counterpart based on the Currency Score. For more information about the currency Score of this week you can read the article "Forex Ranking, Rating and Score" which is published every week together with this article.
By using the comparison table directly below you can get a view without the volatility and statistics as opposed to the "Ranking and Rating list". Only the strength of each currency against the counterparts is analyzed by using the Technical analysis charts of the 4 Time Frames that are also used for the "Ranking and Rating List".
The information from the Comparison Table is the source for calculating the "Ranking and Rating List" where this list additionally uses the volatility and statistics for creating the best and worst performer in the list from number 1 to 28.



"Comparison table" and the "Currency Score Chart"
The additional value of this table compared to the Currency Score table is that the Comparison Table compares the strength between the currencies of each pair. By subtracting the strength of the weaker currency from the stronger currency we have a way to compare each pair combination.
The comparison table provides a way to compare currencies from a longer term perspective of 13 weeks and also simultaneously taking the current trend into account. By coloring the currencies in the X and Y axis according to their Classification we can show what the best combinations are. In doing this we apply 2 rules to make it clearer.
  1. First of all only better classified currencies in combination with weaker classified currencies are "Approved" when there is a Currency Score difference of at least 1 in the current week.
  2. The only exception is when 2 currencies are similarly classified but the Currency Score difference is equal to or more than 4.
  3. It means that each currency should be as far apart from each other as possible in the range from 1 to 8. The classification of the currencies in question may change in the longer term. By using the difference of 4 which is exact at the half of the range it seems a safe approach for trading 2 currencies which are similarly classified.
  4. Even though currencies may be in the same classification a currency may be in a weaker/stronger period and may even change its classification in the future. See the current classification for the coming period at the beginning of this article.


______________________________________

Putting the pieces together

Based on the last "13 Weeks currency classification" and the "Currency Comparison Table" the most interesting currencies for going long seem to be the:
AUD, CAD and USD
.
These are Strong or Neutral currencies from a longer term perspective when looking at the last "13 Weeks currency classification".

For going short the same analysis can be done and the following currencies seem to fit best:
GBP, EUR and CHF.
These are Weak or Neutral currencies from a longer term perspective.

Currencies with a high deviation seem less interesting to trade because they are less predictable. A good example at the moment is/are e.g. the:
AUD and JPY.

Some of the pairs in the "Currency Comparison Table" comply for a longer term trade based on the Technical Analysis (TA) of the Daily and Weekly chart. For the coming week these seem to be: EUR/CAD, GBP/AUD, EUR/AUD, GBP/CAD, GBP/NZD, AUD/CHF and CAD/CHF.




______________________________________

Besides this article I also use the Forex "Ranking, Rating and Score" which is also available once a week on my blog. In the article "Ranking, Rating and Score" we look in more detail at the absolute position of the currencies and pairs.

It is recommended to read the page "Currency score explained", "Introduction to the FxTaTrader Forex Models" and "Statistics and Probabilities" for a better understanding of the article. If you would like to use this article then mention the source by providing the URL FxTaTrader.com or the direct link to this article. Good luck in the coming week.



______________________________________

DISCLAIMER: The articles are my personal opinion, not recommendations, FX trading is risky and not suitable for everyone.The content is for educational purposes only and is aimed solely for the use by ‘experienced’ traders in the FOREX market as the contents are intended to be understood by professional users who are fully aware of the inherent risks in forex trading. The content is for 'Forex Trading Journal' purpose only. Nothing should be construed as recommendation to purchase any financial instruments. The choice and risk is always yours. Thank you.

Forex Ranking, Rating and Score for Week 8 / 2017

The Top 10 of the Ranking and Rating list for the coming week shows the following stronger currencies being well represented for going long: AUD(3X) with the JPY(3X) followed by the CAD(2X). The weaker currencies are the GBP(5X) followed by the EUR(3X) and the CHF(2X).
A nice combination for coming week may be e.g:
  • GBP/AUD with the EUR/CAD
  • EUR/AUD with the CHF/JPY
  • GBP/CAD with the AUD/CHF
Some of the pairs in the list comply for a longer term trade based on the Technical Analysis (TA) of the Daily and Weekly chart. For the coming week these seem to be: EUR/CAD, GBP/AUD, EUR/AUD, GBP/CAD, GBP/NZD, AUD/CHF and CAD/CHF. For more details read both of my articles where the relevant Charts and Tables are provided.



______________________________________

Ranking and Rating list

Analysis based on TA charts for all the major currency pairs. Good luck to all. No advice, just info. Every week the Forex ranking rating list will be prepared in the weekend. All the relevant Time Frames will be analyzed and the ATR and Pip value will be set.





______________________________________

For analyzing the best pairs to trade looking from a longer term perspective the last 13 weeks Currency Classification can be used in support.
This was updated on 12 February 2017 and is provided here for reference purposes:
Strong: USD, NZD, CAD. The preferred range is from 6 to 8.
Neutral: CHF, AUD. The preferred range is from 4 to 5.
Weak: JPY, EUR, GBP. The preferred range is from 1 to 3.

When comparing the 13 weeks Currency Classification with the pairs mentioned in the Ranking List above some would then become less interesting. On the other hand these pairs are at the top of the list partly also because of their volatility. It seems best to take positions for a short period then and take advantage of the high price movements.
With the FxTaTrader Strategy these pairs are not traded because these would be trades in the 4 Hour chart or in a lower Time Frame. Nevertheless they may offer good chances for the short term trader.



______________________________________

Currency Score Chart

The Currency Score analysis is one of the parameters used for the Ranking and Rating list which is published also in this article. The Currency Score is my analysis on the 8 major currencies based on the technical analysis charts using the MACD and Ichimoku indicator on 4 Time Frames: the monthly, weekly, daily and 4 hours. The result of the technical analysis is the screenshot here below.



When comparing the 13 weeks Currency Classification with the recent Currency Score, as provided in the image above, we can determine the deviations. In the article "Forex Strength and Comparison" this is analyzed in more detail. Currencies with a high deviation seem less interesting to trade because they are less predictable. A good example at the moment is/are e.g. the AUD and JPY. Unless a clear opportunity based on the longer term is shown it seems best to be avoided.



______________________________________

Besides this article I also use the Forex "Strength and Comparison" which is also available once a week on my blog. In that article we look in more detail at the relative position of the currencies and pairs. We will look in more detail at the interesting pairs from a longer term perspective for trading in the Daily and Weekly chart. We will use the information from this article, "Ranking, Rating and Score", and analyze it further in more detail.

It is recommended to read the page "Currency score explained", "Introduction to the FxTaTrader Forex Models" and "Statistics and Probabilities" for a better understanding of the article. If you would like to use this article then mention the source by providing the URL FxTaTrader.com or the direct link to this article. Good luck in the coming week.



______________________________________

DISCLAIMER: The articles are my personal opinion, not recommendations, FX trading is risky and not suitable for everyone.The content is for educational purposes only and is aimed solely for the use by ‘experienced’ traders in the FOREX market as the contents are intended to be understood by professional users who are fully aware of the inherent risks in forex trading. The content is for 'Forex Trading Journal' purpose only. Nothing should be construed as recommendation to purchase any financial instruments. The choice and risk is always yours. Thank you.

Sunday, February 12, 2017

Forex Strength and Comparison for Week 7 / 2017

In the Currency Strength table the AUD was again the strongest currency while the EUR was the weakest. The USD gained 2 points last week and the NZD lost 2. All the other Currencies remained around the level of the previous week with a maximum difference of just 1 point.



______________________________________

13 Weeks Currency Score Strength

The 13 Weeks Currency Strength and the 13 Weeks Average are provided here below. This data and the "13 weeks Currency Classification" are considered for deciding on the preferred range. Because it is not ideal nor desired to change the range for a currency every single week, we perform several checks to avoid this.
  1. First of all the strength over a period of the last 13 weeks is considered. See each row for more information.
  2. Next the 13 weeks average is considered, see the last row called "Avg. 13 wks."
  3. The number of weeks that a currency was stronger than another currency can also be considered.
  4. The Technical Analysis (TA) Charts for each Time Frame could also be consulted.


For analyzing the best pairs to trade looking from a longer term perspective the last 13 weeks Currency Classification can be used in support.
This was updated on 12 Fegruary 2017 and is provided here for reference purposes:
Strong: USD, NZD, CAD. The preferred range is from 6 to 8.
Neutral: CHF, AUD. The preferred range is from 4 to 5.
Weak: JPY, EUR, GBP. The preferred range is from 1 to 3.

When looking at the Average 13 wks. Score the USD remains the strongest of all while the EUR remains the weakest. The currencies are grouped together around a level which makes clear to what classification they fit best. The CAD has become a Strong currency because of the good performance lately. In the last 13 weeks it had 7 times a higher Score compared to the USD which is also a strong currency.


_____________________________________

The Strong Currencies

The CAD is back at the high levels after having a dip in week 4 with a Score of 1. This currency is now classified as a strong currency. The other strong currencies are doing well also except for last week where the currencies are on the lower side of the range for Strong currencies.Below you can see the Weekly Currency Score Chart with the 6 months data as a reference.






_____________________________________

Currency Score Comparison
"Comparison table" and the "Ranking and Rating list"
The Forex Currency Comparison Table compares each currency with its counterpart based on the Currency Score. For more information about the currency Score of this week you can read the article "Forex Ranking, Rating and Score" which is published every week together with this article.
By using the comparison table directly below you can get a view without the volatility and statistics as opposed to the "Ranking and Rating list". Only the strength of each currency against the counterparts is analyzed by using the Technical analysis charts of the 4 Time Frames that are also used for the "Ranking and Rating List".
The information from the Comparison Table is the source for calculating the "Ranking and Rating List" where this list additionally uses the volatility and statistics for creating the best and worst performer in the list from number 1 to 28.




"Comparison table" and the "Currency Score Chart"
The additional value of this table compared to the Currency Score table is that the Comparison Table compares the strength between the currencies of each pair. By subtracting the strength of the weaker currency from the stronger currency we have a way to compare each pair combination.
The comparison table provides a way to compare currencies from a longer term perspective of 13 weeks and also simultaneously taking the current trend into account. By coloring the currencies in the X and Y axis according to their Classification we can show what the best combinations are. In doing this we apply 2 rules to make it clearer.
  1. First of all only better classified currencies in combination with weaker classified currencies are "Approved" when there is a Currency Score difference of at least 1 in the current week.
  2. The only exception is when 2 currencies are similarly classified but the Currency Score difference is equal to or more than 4.
  3. It means that each currency should be as far apart from each other as possible in the range from 1 to 8. The classification of the currencies in question may change in the longer term. By using the difference of 4 which is exact at the half of the range it seems a safe approach for trading 2 currencies which are similarly classified.
  4. Even though currencies may be in the same classification a currency may be in a weaker/stronger period and may even change its classification in the future. See the current classification for the coming period at the beginning of this article.



______________________________________

Putting the pieces together

Based on the last "13 Weeks currency classification" and the "Currency Comparison Table" the most interesting currencies for going long seem to be the:
AUD, CAD and USD
.
These are Strong or Neutral currencies from a longer term perspective when looking at the last "13 Weeks currency classification".

For going short the same analysis can be done and the following currencies seem to fit best:
EUR, GBP and CHF.
These are Weak or Neutral currencies from a longer term perspective.

Currencies with a high deviation seem less interesting to trade because they are less predictable. A good example at the moment is/are e.g. the:
AUD.

Some of the pairs in the "Currency Comparison Table" comply for a longer term trade based on the Technical Analysis (TA) of the Daily and Weekly chart. For the coming week these seem to be: GBP/AUD, EUR/AUD, GBP/CAD, EUR/CAD, AUD/CHF, AUD/JPY and CAD/CHF.




______________________________________

Besides this article I also use the Forex "Ranking, Rating and Score" which is also available once a week on my blog. In the article "Ranking, Rating and Score" we look in more detail at the absolute position of the currencies and pairs.

It is recommended to read the page "Currency score explained", "Introduction to the FxTaTrader Forex Models" and "Statistics and Probabilities" for a better understanding of the article. If you would like to use this article then mention the source by providing the URL FxTaTrader.com or the direct link to this article. Good luck in the coming week.


______________________________________

DISCLAIMER: The articles are my personal opinion, not recommendations, FX trading is risky and not suitable for everyone.The content is for educational purposes only and is aimed solely for the use by ‘experienced’ traders in the FOREX market as the contents are intended to be understood by professional users who are fully aware of the inherent risks in forex trading. The content is for 'Forex Trading Journal' purpose only. Nothing should be construed as recommendation to purchase any financial instruments. The choice and risk is always yours. Thank you.

Forex Ranking, Rating and Score for Week 7 / 2017

The Top 10 of the Ranking and Rating list for the coming week shows the following stronger currencies being well represented for going long: AUD(4X) followed by the CAD(3X) and the USD(2X). The weaker currencies are the EUR(3X) with the GBP(3X) and the CHF(3X).
A nice combination for coming week may be e.g:
  • GBP/AUD with the EUR/CAD
  • EUR/AUD with the USD/CHF
  • GBP/CAD with the EUR/USD
Some of the pairs in the list comply for a longer term trade based on the Technical Analysis (TA) of the Daily and Weekly chart. For the coming week these seem to be: GBP/AUD, EUR/AUD, GBP/CAD, EUR/CAD, AUD/CHF, AUD/JPY and CAD/CHF. For more details read both of my articles where the relevant Charts and Tables are provided.



______________________________________

Ranking and Rating list

Analysis based on TA charts for all the major currency pairs. Good luck to all. No advice, just info. Every week the Forex ranking rating list will be prepared in the weekend. All the relevant Time Frames will be analyzed and the ATR and Pip value will be set.






______________________________________

For analyzing the best pairs to trade looking from a longer term perspective the last 13 weeks Currency Classification can be used in support.
This was updated on 12 Fegruary 2017 and is provided here for reference purposes:
Strong: USD, NZD, CAD. The preferred range is from 6 to 8.
Neutral: CHF, AUD. The preferred range is from 4 to 5.
Weak: JPY, EUR, GBP. The preferred range is from 1 to 3.

When comparing the 13 weeks Currency Classification with the pairs mentioned in the Ranking List above some would then become less interesting. On the other hand these pairs are at the top of the list partly also because of their volatility. It seems best to take positions for a short period then and take advantage of the high price movements.
With the FxTaTrader Strategy these pairs are not traded because these would be trades in the 4 Hour chart or in a lower Time Frame. Nevertheless they may offer good chances for the short term trader.



______________________________________

Currency Score Chart

The Currency Score analysis is one of the parameters used for the Ranking and Rating list which is published also in this article. The Currency Score is my analysis on the 8 major currencies based on the technical analysis charts using the MACD and Ichimoku indicator on 4 Time Frames: the monthly, weekly, daily and 4 hours. The result of the technical analysis is the screenshot here below.



When comparing the 13 weeks Currency Classification with the recent Currency Score, as provided in the image above, we can determine the deviations. In the article "Forex Strength and Comparison" this is analyzed in more detail. Currencies with a high deviation seem less interesting to trade because they are less predictable. A good example at the moment is/are e.g. the AUD. Unless a clear opportunity based on the longer term is shown it seems best to be avoided.



______________________________________

Besides this article I also use the Forex "Strength and Comparison" which is also available once a week on my blog. In that article we look in more detail at the relative position of the currencies and pairs. We will look in more detail at the interesting pairs from a longer term perspective for trading in the Daily and Weekly chart. We will use the information from this article, "Ranking, Rating and Score", and analyze it further in more detail.

It is recommended to read the page "Currency score explained", "Introduction to the FxTaTrader Forex Models" and "Statistics and Probabilities" for a better understanding of the article. If you would like to use this article then mention the source by providing the URL FxTaTrader.com or the direct link to this article. Good luck in the coming week.



______________________________________

DISCLAIMER: The articles are my personal opinion, not recommendations, FX trading is risky and not suitable for everyone.The content is for educational purposes only and is aimed solely for the use by ‘experienced’ traders in the FOREX market as the contents are intended to be understood by professional users who are fully aware of the inherent risks in forex trading. The content is for 'Forex Trading Journal' purpose only. Nothing should be construed as recommendation to purchase any financial instruments. The choice and risk is always yours. Thank you.

Sunday, February 5, 2017

Forex Strength and Comparison for Week 6 / 2017

In the Currency Strength table the AUD was the strongest currency while the GBP was the weakest. The AUD gained 4 points last week and the JPY gained 3. The USD, GBP and CHF lost 2 points. All the other Currencies remained around the level of the previous week with a maximum difference of just 1 point.


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13 Weeks Currency Score Strength

The 13 Weeks Currency Strength and the 13 Weeks Average are provided here below. This data and the "13 weeks Currency Classification" are considered for deciding on the preferred range. Because it is not ideal nor desired to change the range for a currency every single week, we perform several checks to avoid this.
  1. First of all the strength over a period of the last 13 weeks is considered. See each row for more information.
  2. Next the 13 weeks average is considered, see the last row called "Avg. 13 wks."
  3. The number of weeks that a currency was stronger than another currency can also be considered.
  4. The Technical Analysis (TA) Charts for each Time Frame could also be consulted.


For analyzing the best pairs to trade looking from a longer term perspective the last 13 weeks Currency Classification can be used in support.
This was updated on 8 January 2017 and is provided here for reference purposes:
Strong: USD, NZD. The preferred range is from 7 to 8.
Neutral: CHF, AUD, CAD. The preferred range is from 4 to 6.
Weak: JPY, EUR, GBP. The preferred range is from 1 to 3.

When looking at the Average 13 wks. Score the USD remains the strongest of all while the EUR remains the weakest. The currencies are grouped together around a level which makes clear to what classification they fit best. For some currencies this may not be very clear, a good example at the moment is the CAD being a Neutral currency but having an Average 13 wks. score of 5,7692 being between the Strong and Neutral currencies.




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The Weak Currencies

The JPY is gaining strength lately and seems to be bottoming. The EUR and GBP are clearly remaining very weak.Below you can see the Weekly Currency Score Chart with the 6 months data as a reference.






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Currency Score Comparison


"Comparison table" and the "Ranking and Rating list"
The Forex Currency Comparison Table compares each currency with its counterpart based on the Currency Score. For more information about the currency Score of this week you can read the article "Forex Ranking, Rating and Score" which is published every week together with this article.
By using the comparison table directly below you can get a view without the volatility and statistics as opposed to the "Ranking and Rating list". Only the strength of each currency against the counterparts is analyzed by using the Technical analysis charts of the 4 Time Frames that are also used for the "Ranking and Rating List".
The information from the Comparison Table is the source for calculating the "Ranking and Rating List" where this list additionally uses the volatility and statistics for creating the best and worst performer in the list from number 1 to 28.




"Comparison table" and the "Currency Score Chart"
The additional value of this table compared to the Currency Score table is that the Comparison Table compares the strength between the currencies of each pair. By subtracting the strength of the weaker currency from the stronger currency we have a way to compare each pair combination.
The comparison table provides a way to compare currencies from a longer term perspective of 13 weeks and also simultaneously taking the current trend into account. By coloring the currencies in the X and Y axis according to their Classification we can show what the best combinations are. In doing this we apply 2 rules to make it clearer.

  1. First of all only better classified currencies in combination with weaker classified currencies are "Approved" when there is a Currency Score difference of at least 1 in the current week.
  2. The only exception is when 2 currencies are similarly classified but the Currency Score difference is equal to or more than 4.
  3. It means that each currency should be as far apart from each other as possible in the range from 1 to 8. The classification of the currencies in question may change in the longer term. By using the difference of 4 which is exact at the half of the range it seems a safe approach for trading 2 currencies which are similarly classified.
  4. Even though currencies may be in the same classification a currency may be in a weaker/stronger period and may even change its classification in the future. See the current classification for the coming period at the beginning of this article.



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Putting the pieces together

Based on the last "13 Weeks currency classification" and the "Currency Comparison Table" the most interesting currencies for going long seem to be the:
AUD, NZD and CAD
.
These are Strong or Neutral currencies from a longer term perspective when looking at the last "13 Weeks currency classification".

For going short the same analysis can be done and the following currencies seem to fit best:
GBP, EUR and CHF.
These are Weak or Neutral currencies from a longer term perspective.

Currencies with a high deviation seem less interesting to trade because they are less predictable. A good example at the moment is/are e.g. the:
AUD, JPY and USD.

Some of the pairs in the "Currency Comparison Table" comply for a longer term trade based on the Technical Analysis (TA) of the Daily and Weekly chart. For the coming week these seem to be: EUR/AUD, EUR/NZD, EUR/CAD, AUD/CHF, AUD/USD, NZD/CHF and AUD/JPY.




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Besides this article I also use the Forex "Ranking, Rating and Score" which is also available once a week on my blog. In the article "Ranking, Rating and Score" we look in more detail at the absolute position of the currencies and pairs.

It is recommended to read the page "Currency score explained", "Introduction to the FxTaTrader Forex Models" and "Statistics and Probabilities" for a better understanding of the article. If you would like to use this article then mention the source by providing the URL FxTaTrader.com or the direct link to this article. Good luck in the coming week.


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DISCLAIMER: The articles are my personal opinion, not recommendations, FX trading is risky and not suitable for everyone.The content is for educational purposes only and is aimed solely for the use by ‘experienced’ traders in the FOREX market as the contents are intended to be understood by professional users who are fully aware of the inherent risks in forex trading. The content is for 'Forex Trading Journal' purpose only. Nothing should be construed as recommendation to purchase any financial instruments. The choice and risk is always yours. Thank you.