Forex Technical Analysis based on experience and research.

Sunday, September 10, 2017

Forex Metrics and Chart Week 37 / 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: the CAD(4X) followed by the EUR(2X) with the CHF(2X) and the AUD(2X). The weaker currencies are the USD(4X) followed by the NZD(3X).
By diversifying a nice combination can be traded in the coming week like e.g.:
  • USD/CAD with the EUR/NZD
  • EUR/USD with the NZD/CAD


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 3 September 2017 and is provided here for reference purposes:
Strong: EUR, AUD, NZD and CAD. The preferred range is from 5 to 8.
Neutral: JPY and CHF. The preferred range is 3 to 4.
Weak: USD and GBP. The preferred range is from 1 to 2.

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.


Chart of the Week

The Chart for this week is the AUD/USD 4 Hour chart.
Price is clearly in an uptrend and made a high lately. It is now consolidating below that level and around the Tenkan-Sen. It may continue to consolidate in the coming period and show a little more weakness towards the Kijun-Sen or a bit lower.
  1. A nice buy opportunity would be around the level of the Kijun-Sen at 0.8032 and the Nr. 1 yellow dotted line at 0.8000. This seems to be a support where price had difficulties to break through.
  2. The target should be below the latest Open and Close of the highest bars lately at 0.8105.
  3. The MACD is looking fine and as long as it does not cross the Zero line at remains positive the set-up remains valid. By preference the MACD minus Signal (Blue and Red bars) should show a recovery in case of red bars or increasing strength in case of blue bars.
The Daily chart should remain as it is with the PSAR remaining Long and a possible pullback not going lower than the level discussed in point 1 here above.
The price will then remain around the Tenkan-Sen on a possible pullback and still have enough momentum to continue the uptrend again.

  • This is a pair that fits best in Point 1 of the Comparison Table Guide which you can also read here below.
    • Better-classified currencies in combination with weaker-classified currencies can always be traded and vice versa. The Currency Score difference may be negative. In that case, the trade should be made after a pullback. In other words, a trade can then only take place after a recovery and the main trend being confirmed again.
  • The AUD is a Strong currency and the USD a Weak currency. The Currency Score Difference is 5.
For more information about the "Comparison Table Guide" read my other Weekly article called the "Forex Strength and Comparison".


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.