Forex Currency Score Difference For Week 1
Forex Technical Analyst Trader | Jan 03, 2016 05:42AM ET
The Currency Score Difference analysis is the more extensive explanation on the Currency score analysis which was published earlier this weekend. Besides these analyses and the corresponding charts I also provide the Forex ranking and rating list.
It is recommended to read the page 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 is the 2 screenshots in this article showing the Currency Score Difference and the Top Forex pairs table.
In the previous article the analysis was made for the Currency Score and a summary of the results are here below:
- The JPY has a score at the moment of a strong currency and it seems best for trading going long against the weak currencies.
- The GBP has a score at the moment of a weak currency and it seems best for trading going short against the strong currencies.
- There is a pullback for the USD and the CHF.
- The other currencies, the NZD, AUD, EUR and the CAD are within their range.
- All the interesting pairs from the "Ranking and Rating list" do also look interesting according to the "Currency Score" analysis from the previous article.
Currency Score difference
According to the Ranking and Rating list already published this weekend the following pair combinations look interesting:
- GBP/NZD with the EUR/JPY
- CAD/JPY with the EUR/NZD
- NZD/CAD with the EUR/JPY
When looking at the Currency Score Table here below for this week we can see the currency score differences. The interesting pairs should have by preference a score difference of 4 or higher when they are similarly classified. Or the better classified pair should have a higher score than the counterpart. All the pairs mentioned above comply for trading in the coming week. The Currencies are colored Green, Orange and Red resp. by the classification they have. This way it is easier to see what currencies should have a certain score difference.
The technical analysis is the most important issue to consider before taking positions, the Weekly Chart is 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 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.
The following table shows the location related to the Bollinger Bands of each interesting pair analyzed and approved in all the previous analyses.
- The pairs located within the Bollinger Bands and at the Bollinger Bands have the best opportunities because the chance of a pullback is the lowest.
Get The News You Want
- Any pair slightly above or below the Bollinger Bands may be inside when trading starts again. These pairs have to be checked on opening of the market.
- Also, any pair outside the Bollinger Bands may be interesting when trading starts because of a pullback in the pair
- .
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. 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 recommendation to purchase any financial instruments.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.