6/12 Analysis: Knowing which pairs have more profit potential
So at the London open we have 3 strong currencies well above the zero line and 3 weak currencies well below the zero line.
However, we only have 2 that meet our criteria for entry. The CHF (turquoise line) is strong and getting stronger with a steep line up indicating momentum. The NZD is weak and getting weaker with a steep line down.
The best trade option when only considering the indicator is the NZD/CHF but I know that that pair does not move in a very wide range so I’ll look for a better option.
The GBP (red line) is strong but hasn’t turned up yet with momentum. I would want to keep an eye on this currency because the GBP/NZD is a potentially more profitable opportunity.
If we wait just a couple minutes into the session, this is what the indicator looked like:
Now you can see the GBP is the strongest currency with a steep line up indicating momentum and the NZD remains weak with a steep line down.
- GBP/NZD BUY
That move was over 100 pips. Now, compare that to the NZD/CHF sell:
So although this would have also been a profitable trade by knowing the pairs that give the better potential profit, you could have been involved in a move that was 3 times larger.
Watch the entire video analysis below:
You can see that our Currency Strength Indicator is an effective tool for picking out the highest probability, lowest risk trade set ups while avoiding market conditions that aren’t favorable. If you keep using this tool every day along with our daily Forex analysis, you will increase your win rate and be on your way to becoming a profitable trader long term.
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