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, CHF and CAD are the stronger currencies. The AUD, EUR, NZD and JPY 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 JPY and the CAD are difficult to trade because they are in the middle of the range.
- The CHF has a high correlation with the EUR so it does not have the preference to go long with. Conclusion is that for the coming week it seems best to go long with the USD and the GBP.
- For the weaker currencies the AUD seems to have a temporary dip according to the currency score chart of this currency and may recover soon. I will go more into details in this article. Conclusion is that for the coming week it seems best to go short with the EUR and the NZD.
- The best combinations for the coming week are the EUR/USD, NZD/USD and the EUR/GBP. The pairs are having a good ranking in the ranking & rating list of resp. 3, 4 and 6.
- 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/CAD and profit was made on 1 position. More on this in my strategy article later this day.
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Weaker currencies
In the previous week I indicated that the NZD and AUD seem to have a temporary dip according to the currency score chart. This week I changed my view and consider only the AUD having a temporary dip.
The NZD was a doubtful case and it seems now as if it will remain weak for a longer period. It had a score of 5 or lower since July 25 but it remained in the middle range. In the last few weeks it went to a score of 3 or lower. When comparing the EUR with the NZD, the latter was a better performer lately but this changed in the last few weeks. At this moment the EUR and NZD are the weakest currencies.
When looking at the AUD it is a different story. Since last April it was at the a higher side of the range and having some dips with fast recovery. This changed just in the last few weeks and it is now at the lower side of the range. It is however too soon to conclude that it is behaving in a similar way as the EUR and NZD. It will take a few more weeks with some tops in the currency score not going very high to conclude that the AUD is really a weak currency for a longer period. This is the reason for not going short (yet) on the AUD.
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Later on this day I will provide the weekly review on my FxTaTrader Hybrid Grid strategy. Good luck to all, have a good trading 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.
