KT Currency Strength Meter Indicator
MT4/MT5

Advantages

• It provides new trading opportunities using real-time alerts of major currencies' strengths and weaknesses.
• It helps filter out the buy and sell signals against a weak or strong currency.
• It helps eliminate forced hedging and over-trading.
• Avoid the high-risk counter-trend trades, i.e., never buy the weakest currency against the strongest and vice versa.
• It helps to filter out the trading positions that cancel out each other.
• It is updated in real-time using the most recent data.
• It uses minimum CPU resources so that your other strategies and deployed indicators remain unaffected.
• A unique color is dedicated to each currency, which helps distinguish the currency pairs quickly.
• It has simple input parameters without any complicated settings.
  
  

How to use the Currency Strength Meter to improve trading Forex?

In the above picture, the currency meter shows the Euro is the strongest while New Zealand Dollar is the weakest currency. Using this information, you can plan to enter a long trade on the EURNZD pair.

It works like a compass that shows a currency's overall direction, which helps to plan the entry positions.

Currency Strength Meter Indicator MT5

More traders are moving from MT4 to MT5 as Metaquotes stopped supporting the older Metatrader 4 builds. Therefore, we suggest purchasing the MT5 version to remain future-proof.

Input Parameters

• Period: Moving average period to find the strength and weakness.
• Choose a color for the Australian Dollar.
• Choose a color for the Canadian Dollar.
• Choose a color for the Swiss Franc.
• Choose a color for Euro.
• Choose a color for Great Britain Pound.
• Choose a color for the Japanese Yen.
• Choose a color for New Zealand Dollar.
• Choose a color of US Dollar.

Pro Tip

• Some free currency strength meters are available on the internet, but they are buggy and don't work as expected.
• We suggest not using it on smaller time frames as anything below 15 minutes to avoid being trapped by noisy data.
• Avoid relying too much on high-impact news, as the fundamental always comes first before the technical analysis.
• Using it as a confirmation instead of the primary signal generation is best.
• To combine the correlation analysis with a strength meter, we suggest getting our premium Currency Strength indicator MT5.
  
  

Limitations

• Most of the time, it works as a short-term strength meter which can change often. For the same reason, We suggest using it on higher time-frames like 1-Hour and above.
• While it works great in combination with other indicators, using it as a standalone in a trading strategy is limited.
• Based on moving averages, there could be a lag between the new strength and weakness identification.
  
  

How does the Currency Strength Meter Works?

Using a weighted moving average, the currency strength meter measures the net percentage change in a currency price. It then compares it against US Dollars to find the strength and weaknesses of each currency separately.

As its a time-frame dependent, the strength and weakness data is updated at the close of each bar.