June 22, 2015Daily Analysis

6/22 Analysis: Know the Market

Even when you are using a tool such as our Currency Strength Indicator and looking to pair strong currencies against weak currencies, you must have a certain depth of knowledge about the market to trade successfully long term.

For example, if we look at our initial analysis today, you will see the CHF (turquoise line) is weak and the CAD (green line) is strong. The obvious pairing would be a CAD/CHF BUY.

However, knowing that this pair is not very volatile with a daily average range from high to low of only about 50 pips plus a wide spread of typically around 6-7 pips is something you should consider.  We would need to see really steep lines on these particular currencies (indicating huge momentum in the market) to trade this pair and we just aren’t seeing that currently.

In this case, staying out of the market paid off because a few minutes into this session, this is what it looked like:

I want to illustrate how you can quickly jump on these moves before the crowd when you see this type of change in momentum.

Now, I’m using a much more advanced system than what I show you here for free, but just looking at the indicator you can see a sharp turn in the CHF to the upside with a very steep line (current momentum in the market) and the down turn in the USD (blue line) with a very steep line (current momentum).

  • USD/CHF SELL

Since this move was so quick, I wasn’t able to enter until the bottom of that first price bar. But even still, I was able to participate in a 30 pip move from that point.

What I’m showing you here is that the indicator is very versatile. It can be used for a breakout strategy at the open like I’ve showed you in past videos and/or you can use it to read and react to these quick momentum moves in the market when they occur.

Watch the video analysis here:

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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James Edward
James Edward has been a successful Forex hedge fund manager & educator for over a decade. He founded Complete Currency Trader, a London based firm that has consistently trained individuals to become professional and profitable traders long term using the individual currency strength analysis methodology. CCT is an elite Forex educational firm and has a reputation second to none with over 90 positive reviews and an overall 4.538 out of 5 rating on the third party verification site Forex Peace Army. James’s affable personality, expert knowledge, notoriety for getting results, and steadfast dedication to his clients, has secured his position as one of the most trustworthy, liked, and in demand authorities in the industry.