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Currency Strength Indicator Trading

  • #1
  • First Post: Edited Jan 4, 2019 8:43pm Apr 11, 2017 7:08am | Edited Jan 4, 2019 8:43pm
Hi FF!

There are many currency strength indicators floating around in internet and most of them seems to be modified versions of CCFp indicator, I was using one of the versions for a while with indications of currency strengths , but sometimes it seemed to give incorrect data about strength of the currencies and so I decided to get some understanding of code and do the necessary changes by my views.

This thread is for all trading related actions with this indicator. You can post you observations and developed strategies with this indicator in this thread.

Regards and good luck!
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 47 KB

Recommended inputs: default ,but feel free to experiment

Disclaimer: Before trying any of suggestions or strategy mentioned in this thread, try it on historical data or demo account first, to gain confidence and gain knowledge about what is the probability of it happening.


Edit: I have stopped following this thread, if you have any questions send me a message.
Attached File(s)
File Type: ex4 EKS_MF_3.0.ex4   60 KB | 3,525 downloads
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  • #2
  • Apr 11, 2017 7:37am Apr 11, 2017 7:37am
Hi Erik
Just a question your zero level what's it based on? Moving average?If so then how you determine what's appropriate MA for Zero should be.
thank you
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  • #3
  • Edited 9:10am Apr 11, 2017 8:27am | Edited 9:10am
Quoting Davit
Hi Erik Just a question your zero level what's it based on? Moving average?If so then how you determine what's appropriate MA for Zero should be. thank you
CCFp indicator is based on fast Moving Average and slow Moving average, you can edit them if necessary in inputs (fast=, slow=). Calculations for each currency consists of pairs with largest influence. Strength is equal to sum of pair (fast MA/slow MA -1) or (slow MA/fast MA - 1) depends on which currency is needed. -1 is because of division, it is always around 1 ,but if we subtract 1 then 0 is the point we orientate around. Personally I do not give 0 any meaning or use it as neutral point. What I look for is direction and the angle of currency strength, also I am looking how far away from 0 it is going ,giving me some insight of volatility and change in it. You can use it to see trends and length of them in time.
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  • #4
  • Apr 11, 2017 8:52am Apr 11, 2017 8:52am
How to identify trend ?

Here is the way I use this indicator to do this.

To identify trend just do the same as you would do in normal chart - draw a line. Doing this lets you know where the money is flowing.
To illustrate this I will use USD and AUD:
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 30 KB

The red lines are trend lines by the latest trend line which wasn't drawn, you can tell that AUDUSD should be going north ,now lets check it:
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot2.png Size: 23 KB

As you can see in chart , it is just as thought before. Only thing we can't tell is the movement in pips(distance), but these are not bad news at all. You can compare the actions in indicator and that pair and determine the direction in which market flows more easily.
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  • #5
  • Apr 11, 2017 9:14am Apr 11, 2017 9:14am
Quoting Davit
Hi Erik Just a question your zero level what's it based on? Moving average?If so then how you determine what's appropriate MA for Zero should be. thank you
By calculations, 0 point should be if fast MA and slow MA is equal in currencies all major pairs.
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  • #6
  • Apr 11, 2017 2:18pm Apr 11, 2017 2:18pm
Quoting fxanalysis
Hi FF! There are many currency strength indicators floating around in internet and most of them seems to be modified versions of CCFp indicator, I was using one of the versions for a while with indications of currency strengths , but sometimes it seemed to give incorrect data about strength of the currencies and so I decided to get some understanding of code and do the necessary changes by my views. This thread is for all trading related actions with this indicator. You can post you observations and developed strategies with this indicator in this...
hI FX ANALYSIS ,i download thanks .my humble request please add options like current pair only (show only 2 lines of current pair) so other pairs line not show but calculations /logic same as you put.looking forward .thanks in advance
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  • #7
  • Apr 11, 2017 3:22pm Apr 11, 2017 3:22pm
You can just change line colors to black or whatever background is if want to eliminate pairs but I can appreciate the option to eliminate as well.

Really nice work, FX. I can see a lot of potential for this. At first glance I notice that just playing the EUR/GBP cross gives one successful trade per month with no losers in the short time frame the indicator is set for.

Is their any way to program an option to move the indicator in blocks of time for more extensive back testing? In other words, right now it covers 10-17-16 (150 candles) to current but it would be nice to move that same 150 candle block back another 150 candles. This way we could back test without covering huge distances of time and using up a lot of processing power.

Again, really nice work. Thank you for sharing with the community.

Rex
  • #8
  • Apr 11, 2017 6:19pm Apr 11, 2017 6:19pm
Quoting Rex Tradewell
You can just change line colors to black or whatever background is if want to eliminate pairs but I can appreciate the option to eliminate as well. Really nice work, FX. I can see a lot of potential for this. At first glance I notice that just playing the EUR/GBP cross gives one successful trade per month with no losers in the short time frame the indicator is set for. Is their any way to program an option to move the indicator in blocks of time for more extensive back testing? In other words, right now it covers 10-17-16 (150 candles) to current...
yea i did it and long chit chat with great fxanlysis and then he decided to mod(i am so greatfull to fxanalysis)i hope hope he will think about on/off current pair only..thanks both of you

https://www.forexfactory.com/showthr...11#post9747511
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  • #9
  • Apr 12, 2017 4:08am Apr 12, 2017 4:08am
Quoting classy
{quote} yea i did it and long chit chat with great fxanlysis and then he decided to mod(i am so greatfull to fxanalysis)i hope hope he will think about on/off current pair only..thanks both of you https://www.forexfactory.com/showthr...11#post9747511
A little comment, I had modification sitting ready with finishing touch needed, but I ran into you thread and got some motivation to get back to it. Thanks for that!
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  • #10
  • Apr 12, 2017 4:16am Apr 12, 2017 4:16am
Quoting Rex Tradewell
You can just change line colors to black or whatever background is if want to eliminate pairs but I can appreciate the option to eliminate as well. Really nice work, FX. I can see a lot of potential for this. At first glance I notice that just playing the EUR/GBP cross gives one successful trade per month with no losers in the short time frame the indicator is set for. Is their any way to program an option to move the indicator in blocks of time for more extensive back testing? In other words, right now it covers 10-17-16 (150 candles) to current...
Sorry ,seeing specific blocks is not possible but you can specify total candles that are calculated by changing all_bars in inputs.
Here is the best way to see all calculations in history without using much CPU, because calculations are done only once, use offline charts and set All_Bars to maximal candles in chart:
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 75 KB
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  • #11
  • Apr 12, 2017 4:51am Apr 12, 2017 4:51am
Quoting classy
{quote} hI FX ANALYSIS ,i download thanks .my humble request please add options like current pair only (show only 2 lines of current pair) so other pairs line not show but calculations /logic same as you put.looking forward .thanks in advance
Here is a very simple update where you can turn each pair on or off in inputs ,but it won't change anything much in CPU usage, because most of the usage comes from functions like iMA() but are necessary for other pairs calculations, so these functions can't be turned off.

Later I will try to make indicator calculate only the new candles so it would be more efficient in power consumption , this will use more power at the indicator launching time but less after in live charts.
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 55 KB
Attached File(s)
File Type: ex4 EKS_MF_3.0.1.ex4   62 KB | 2,116 downloads
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  • #12
  • Apr 12, 2017 5:09am Apr 12, 2017 5:09am
Quoting fxanalysis
{quote} A little comment, I had modification sitting ready with finishing touch needed, but I ran into you thread and got some motivation to get back to it. Thanks for that!
fxanalysis ,many many thanks for nice word .i really touched .God bless you.
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  • #13
  • Apr 12, 2017 5:34am Apr 12, 2017 5:34am
This indicator and FX news..

Using this indicator you can guess the possible market reaction of FX news. This approach works best for non-breaking news and non-major changes in news data,because these news has longer impact on markets than typical ones.

If you are looking at the typical news then first of all ,look where the currency is located in indicator(how far from 0? is it as far as it usually goes? e.c.), then if the currency is located away from 0 in imaginative overbought or oversold area, you can try this approach. Currently these would be JPY and GBP:
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 36 KB

As you can see they are both "strong". So if news are good for one of the currency then that currency might slightly move up and then reverse and change direction(if there are no upcoming news for that currency or USD), if news are bad then there is possibility of larger move down and even change of trend(if there are no upcoming news for that currency or USD). The same is if currency is "weak" only reversed.
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  • #14
  • Apr 12, 2017 6:33am Apr 12, 2017 6:33am
I use CCFp and CC for some time, it is nice to see other traders using, too.

Just to help newcomers, my experience is that shortest time frame that has meaninful results is M30.
  • #15
  • Apr 12, 2017 8:01am Apr 12, 2017 8:01am
Another tip. Determining potential for corrections or trend changes.
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 45 KB
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  • #16
  • Apr 12, 2017 8:44am Apr 12, 2017 8:44am
Hi Fxanalysis,

thanks for the nice indicator. Is it possible for the order of the pairs appearing on the chart to be in line with the strength? As in if USD is the strongest then it appears first and say if NZD is the weakest then it is listed last? Thanks.
  • #17
  • Apr 12, 2017 10:13am Apr 12, 2017 10:13am
Quoting Tatachar
Hi Fxanalysis, thanks for the nice indicator. Is it possible for the order of the pairs appearing on the chart to be in line with the strength? As in if USD is the strongest then it appears first and say if NZD is the weakest then it is listed last? Thanks.
How would you determine the strength ? Because I determine strength by watching the angle and length in time for each currency, that is my strength indication, I see those lines as indication where the money is flowing.
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  • #18
  • Apr 12, 2017 2:05pm Apr 12, 2017 2:05pm
Excellent work. Currency strength is one of the first things I always check before launching into my trades!
  • #19
  • Apr 12, 2017 10:13pm Apr 12, 2017 10:13pm
Would love your input on JPY for today. Cheers.
  • #20
  • Apr 13, 2017 12:59am Apr 13, 2017 12:59am
This looks very similar to Tom Yeoman's currency indicator. The text is in a different location and his allows you to pick and choose your currencies which lowers your CPU resources. As well, the input periods are easy to change, and the 0 line can be converted to a base currency. For instance, if you trade GBP pairs, then make the GBP the 0 line and input JPY, USD, EUR, AUD, etc, and you get an automatic crossover. So, not sure how much more work you want to do since it seems this is already invented. Good Luck.
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