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The
Currency Score analysis is one of the parameters used for the
Ranking and Rating list which was published earlier this weekend.
Besides this analysis and the corresponding chart I also provide the
weekly analysis on my strategy
and the Forex ranking and rating list which is available 3 times a week
on this blog.
It is recommended to read the page Currency score explained and Models in practice for a better understanding of the article. This article will provide 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 are the 2 screenshots in this article showing the Currency Score and the Currency Score Difference.
We can also see that the CHF is having a score of 2 and the AUD a score of 3. A weak currency should have by preference a score of 2 or lower and an average currency a score of 3, 4 or 5. The AUD is getting stronger lately and switched places with the CHF last week.
The conclusion is:
According to the Ranking and Rating list already published this weekend
the following pair combinations look interesting.
The technical analysis is the most important issue to consider
before taking positions. The Weekly Chart is being analyzed. I prefer
the Bollinger Band for defining where a pair is in the chart. Once a
pair is outside a Bollinger Band it is in a strong trend which can
cause a strong pullback. Although this may be a good opportunity for
other analysts I avoid taking positions because of the possible
unexpected strong pullback. Positions are only opened inside the
Bollinger Band and this may be at the start of a possible trend or on a
good pullback in an existing trend.
When trading according to the FxTaTrader Strategy some rules are in place. For more information see the page on my blog FxTaTrader Strategy. Depending on the opportunities that may come up the decision to trade a currency may become more obvious at that moment.
Here below are the charts providing the Currency classifications for reference purposes. There are three charts showing resp. the stronger, average and weaker currencies.
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.
It is recommended to read the page Currency score explained and Models in practice for a better understanding of the article. This article will provide 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 are the 2 screenshots in this article showing the Currency Score and the Currency Score Difference.
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Last 3 months currency classification
The last 3 months currency
classification from a longer term
perspective
are provided for reference
purposes. There
are some changes and the new classification is provided here with the
necessary charts which can be found at the bottom of this article. The
currencies are
classified for the coming weeks as follows:
- Strong: USD / NZD / GBP. The preferred range is from 6 to 8.
- Average: CAD / CHF / JPY. The preferred range is from 3 to 5.
- Weak: EUR / AUD. The preferred range is from 1 to 2.
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Currency Score
For analyzing the best pairs to trade this classification is the first issue. When looking at the most recent score that is used for the coming period we can see in the screenshot below that the JPY is having a score of 6 and the NZD a score of 5. A strong currency should have by preference a score of 6 or higher and an average currency a score of 4 or 5. The JPY is getting stronger lately and switched places with the NZD last week.We can also see that the CHF is having a score of 2 and the AUD a score of 3. A weak currency should have by preference a score of 2 or lower and an average currency a score of 3, 4 or 5. The AUD is getting stronger lately and switched places with the CHF last week.
The conclusion is:
- Most of the currencies are at the right level except for the following combinations. The JPY is a point higher and the NZD is 1 point lower, the AUD is a point higher and the CHF is a point lower.
- There is a light pullback at the moment for the NZD and AUD when looking at the market as a whole.
- There is some increase of momentum for the JPY which is getting stronger and for the CHF which is getting weaker.
- The pairs that we may look at are all most
probably trending except for the NZD and AUD which are
most probably ranging.
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Currency
Score difference
- EUR/USD with the CHF/JPY
- USD/CHF with the EUR/JPY
- EUR/GBP with the CHF/JPY
- GBP/CHF with the EUR/JPY
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- The EUR/USD is clearly in a downtrend and nicely within the Bollinger Band.
- The CHF/JPY is in the weekly chart in an uptrend so it is best to avoid this pair although it is within the Bollinger Band.
- The USD/CHF is clearly in an uptrend and nicely within the Bollinger Band.
- The EUR/JPY is clearly in a downtrend and nicely within the Bollinger Band.
- The EUR/GBP is clearly in a downtrend and nicely within the Bollinger Band.
- The GBP/CHF is in the weekly chart in an downtrend so it is best to avoid this pair although it is within the Bollinger Band.
When trading according to the FxTaTrader Strategy some rules are in place. For more information see the page on my blog FxTaTrader Strategy. Depending on the opportunities that may come up the decision to trade a currency may become more obvious at that moment.
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Last 3 months currency classification charts
Here below are the charts providing the Currency classifications for reference purposes. There are three charts showing resp. the stronger, average and weaker currencies.
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