Forex Currency Score Wk 44 / 26-10-2014

26 October 2014, 13:31
Forex Technical Analyst Trader
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In this article I will provide my analysis and the FxTaTrader Currency Scrore chart which is my view on the 8 major currencies based on the Technical analysis charts using the MACD and Ichimoku indacator on 4 time frames, the monthly, weekly, daily and 4 hours. See for full details the page Currency score explained on my blog FxTaTrader.com.

The FxTaTrader Forex Currency Score chart is meaningful data for my FxTaTrader Hybrid Grid strategy. Besides this chart I also provide my weekly analysis on my strategy and the Forex ranking and rating list which is available 3 times a week on this blog. 

 


  • The USD, GBP and CAD are currently the stronger currencies. The EUR, JPY and NZD are the weaker currencies. The best pairs to look at are a combination of those currencies.
  • Currencies with a score of 4 and 5, meaning the CHF and the AUD are difficult to trade because they are in the middle of the range.
  • Conclusion for going long is that for the coming week it seems best to go long with the USD, GBP and the CAD. However the CAD is an average performer from a longer term prespective so it does not have the preference. More details can be fond later in this article.
  • For the weaker currencies the conclusion is that for the coming week it seems best to go short with the EUR, JPY and NZD. However the JPY is an average performer from a longer term prespective so it does not have the preference. More details can be fond later in this article.
  • The best combinations for the coming week also according to the Forex Ranking and Rating list and the TA charts are the EUR/USD, EUR/GBP, USD/JPY and the NZD/USD. These pairs are having a good ranking in the ranking & rating list of resp. 1, 2, 3 and 6. See the Weekly FxTaTrader ranking and rating list.
  • There are some rules for taking positions according to the FxTaTrader Hybrid Grid Strategy. The strategy can open multiple positions of a currency pair but each currency may only be present once in the pairs chosen for trading.  It means that not all the possible positions of coming week can be opened. For more information see FxTaTrader Hybrid Grid Strategy.
  • Last week (pending) orders were placed for the NZD/USD, EUR/USD and the GBP/CAD. Profit was made on 3 positions and losses on 2 and ending the week higher. More on this in my strategy article later this day.

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Average performing currencies

 


In the previous weeks we looked into the weaker and stronger currencies from a longer term perspective using the data of the Currency Score. In this article the average performing currencies will be handled. This way there is a clear view on the best combinations to trade for the coming period. Unless these currencies go complete to the upper or lower side of the range they remain interesting as the average performing currencies and their possibilities as such. As can be seen in the chart above the currencies do almost not touch the upper and lower range.

These currencies can best be traded taking long positions against the weaker currencies and short positions against the stronger currencies. It is best not to trade them against each other because of the continues shifting of strength between each other. When trading against the stronger and weaker currencies the average performing currencies may becomes stronger or weaker but they will in general not get to the score of the currencies traded against. Of course the TA charts play an important part but using this analysis gives already in general a good shifting in what to trade or not.

Last week (pending) orders were placed for the GBP/CAD where the GBP is the stronger currency and the CAD is the average performing currency. Because of the current pull back in the daily chart this pair offers possibilities.

  • As can be seen in the Currency Score chart above, the CAD is having a score of 5 but it is an average performing currency meaning that this score may be the highest for the time being.
  • The rank in the Ranking and Rating list in the last weeks shows also that the pair is attractive for taking long positions.
  • the pull back in the specific GBP/CAD pair and the outlook in the TA charts makes it also an attractive opportunity.
More about this pair in my next article today "Review FxTaTrader Strategy Wk 43&44".

The AUD is currently ranked here as an average performing currencies but it was a stronger currency for a long time. This can be seen in the graph above. If the AUD goes back to the upper range then it behaves as before in the previous months and it will be again a stronger currency. However, the last dip was very low and longer than expected compared to before. For now this currency is an average performing currency after the doubt of the previous weeks. More information can be read in my previous "Currency score" articles. 

This analysis makes it possible to look at currencies from a longer term perspective and provides the inner-strength which cannot always be seen clearly when looking at different charts of a currency and its counterparts. It is an additional analysis that can be used besides the Technical analysis charts and the Forex Ranking and Rating list and it may also diminish risk.

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Later on this day I will provide the weekly review on my FxTaTrader Hybrid Grid strategy. Good luck to all of you in your trading the coming week.

Although the explanation may seem simple and clear there is always risk involved. I added a disclaimer to my blog for this purpose. If you like to use this article then mention the source by providing the URL www.FxTaTrader.com or the direct link to this article.

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