First of all
a happy new year for everyone and a good trading year in 2015. The
Currency Score analysis is one of the parameters used for the Ranking
and Rating list which was published already earlier this weekend.
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 favorite pairs in the Top 10 of this list are being analyzed in more detail here. This article will provide my analysis and the FxTaTrader Currency Score chart which is my view 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. See for full details the page Currency score explained on my blog FxTaTrader.com. The calculation of the Currency Score difference will not be published. Please check the article Forex Currency Score Wk 50 and the previous ones for the examples.
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 in the same direction. It means that not all the possible positions for this coming week can be opened. For more information see FxTaTrader Hybrid Grid Strategy.
Another rule is that a pair outside the Bollinger Band in the Weekly chart is considered overbought/oversold. No positions are taken for these pairs until they are no more overbought/oversold.
Depending on the opportunities that may come up the decision to trade a currency may become more obvious at that moment.
Last week no orders were placed because of lower liquidity in the last period. This week I will start trading again if a good opportunity comes around.
For more information the article "Currency score explained" explains
in full detail how the currency score is being generated. In
my previous articles various aspects have been analyzed as described
above. Read the articles of your preference by clicking the links here
below,
the subjects handled are:
The weaker currencies
The stronger currencies
How to trade the average performing currencies
Using the Currency Score difference for trading decisions
Introduction to the FxTaTrader Forex Models
All preferred combinations comply to the guidelines that define what type of currency, strong/average/weak, can be traded against the other. These are classifications from a longer term perspective where 3 months is being used as a reference. The currencies are classified for the coming week as follows:
For more detailed information about the average performing currencies in the coming period check the Currency Score article Forex Currency Score Wk 50.
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.
The favorite pairs in the Top 10 of this list are being analyzed in more detail here. This article will provide my analysis and the FxTaTrader Currency Score chart which is my view 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. See for full details the page Currency score explained on my blog FxTaTrader.com. The calculation of the Currency Score difference will not be published. Please check the article Forex Currency Score Wk 50 and the previous ones for the examples.
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- The classification of the currencies from a longer term perspective are provided at the bottom of this article for reference purposes.
- There are a lot of changes this week as can be seen in the screenshot.
- The USD, NZD and the GBP are currently the stronger currencies. The EUR, JPY and the AUD are the weaker currencies. The best pairs to look at are combinations of those currencies.
- Currencies with a score of 4 and 5, these are this week the CAD and the CHF are difficult to trade because they are in the middle of the range. Being in the middle of the range means the currency has no clear direction when looking at the whole market and it can easily go in any direction at any time. It is better to have a currency with some momentum in a certain direction because it is then clear how to trade this currency.
- Conclusion for going long is that for the coming week it seems best to go long with the USD, NZD and the GBP. However the NZD is an average performer from a longer term perspective so it does not have the preference unless the currency score difference is significant ( >3).
- For the weaker currencies the conclusion is that for the coming week it seems best to go short with the EUR, JPY and the AUD. These are also weaker currencies from a longer term perspective and from that perspective they also have the preference to be traded short.
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 in the same direction. It means that not all the possible positions for this coming week can be opened. For more information see FxTaTrader Hybrid Grid Strategy.
Another rule is that a pair outside the Bollinger Band in the Weekly chart is considered overbought/oversold. No positions are taken for these pairs until they are no more overbought/oversold.
Depending on the opportunities that may come up the decision to trade a currency may become more obvious at that moment.
Last week no orders were placed because of lower liquidity in the last period. This week I will start trading again if a good opportunity comes around.
___________________________________________
The weaker currencies
The stronger currencies
How to trade the average performing currencies
Using the Currency Score difference for trading decisions
Introduction to the FxTaTrader Forex Models
Last
3 months currency classification
All preferred combinations comply to the guidelines that define what type of currency, strong/average/weak, can be traded against the other. These are classifications from a longer term perspective where 3 months is being used as a reference. The currencies are classified for the coming week as follows:
- Strong: USD / GBP / CHF
- Average: NZD /CAD
- Weak:
JPY / EUR / AUD
For more detailed information about the average performing currencies in the coming period check the Currency Score article Forex Currency Score Wk 50.
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This weekend I will also provide the weekly review on my FxTaTrader Hybrid Grid strategy. Good luck to all and have a great 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 would 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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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.
