Knowledge of the strength and weakness of each currency is vital for every forex trader. Our currency strength indicator measures the strength of eight major currencies (USD, EUR, GBP, CHF, JPY, CAD, AUD, NZD) by using the Relative Strength Index indicator, also known as RSI. PipTick Currency Strength Indicator shows you simply and quickly, when a currency is oversold, overbought, or in a “normal area”. In this way, you can simply identify, which currency is the strongest and which is the weakest.
The indicator is calculated from 28 currency pairs and works on every MT platform. PipTick CSI uses only 7 currency pairs for the calculation of the rest of the 21 pairs. For the correct working of the indicator, you need only these seven pairs in your MT platform: EURUSD, GBPUSD, AUDUSD, NZDUSD, USDJPY, USDCHF, and USDCAD.
Because our PipTick CSI is based on the RSI, its interpretation is very simple. There are three areas.
There are two basic approaches to how to trade currency strength and weakness.
You can achieve great results if you use the overbought/oversold concept of currency in conjunction with Price Action or Candlestick patterns. All you have to do is wait for the overbought/oversold of one currency, followed by drawing a candlestick pattern like a hammer or shooting star. Of course, this is just one of the thousands of possible ways of using our currency strength indicator.
You can use this indicator for long-term, swing, intraday, or even scalp trading.
It is possible to use PipTick CSI for manual backtest as well. All you have to do is set parameter “Bars_Ago = 0” in indicator settings and download historical data for seven currency pairs which our indicator needs to calculate.