I have come up with a new prediction system based on currency analysis. Actually the idea is from the xMeter indicator, so the credits also go to the xMeter creators.
The main idea is to know the strength of a particular currency relative to all other currencies. I have modified the xMeter formula and made it adaptive to continuous market changes by using bollinger bands. Also the new indicator I have come up paints history values and future predictions of the currency strengths based on data mining techniques. The system is able to predict future with an accuracy of above 80%.
Currency Strength Indicator
The system mainly consits of:
1) Indicator (CurrencyStrength_INDv2.0.mq4)
2) Library (mql2svm.mqh, mql2svm.dll, and some additional DLL`s)
Note: The indicator and the future predictor is trained on 5 Minute data. So the indicator can be applied to any of the below mentioned currencies (see currency color image), but only on minute 5 chart.
Note: Also do not add this indicator together with other indicators to the same chart.
1) Download (link below) & extract the zip file somewhere on your computer
2) Copy "CurrencyStrength_INDv2.0.mq4" file to "indicators" folder of your Metatrader installation. Ex: C:\Program Files\Metatrader\experts\indicators
3) Copy "mql2svm.mqh" file to "include" folder of your Metatrader installation. Ex: C:\Program Files\Metatrader\experts\include
4) Important: Copy "mql2svm.dll" file to "libraries" folder of your Metatrader installation. Ex: C:\Program Files\Metatrader\experts\libraries
5) Very Important: Copy "csa" folder included in the zip file also to the "libraries" folder of your Metatrader installation.
6) Restart Metatrader, add the indicator to 5 minute chart of any below mentioned currencies. Zoom chart to Max to see the predictions.
Note: At the first time of loading the indicator you might see strange lines. This could be due to the missing currency data in the history. You should see an error message in the terminal "Data error ZERO value". If this happens after first load of the indicator, wait for a while for the metatrader to update required history. Then reload the indicator or restart the metatrader. Do this untill you no more see the "Data error ZERO value" error message in the terminal.
Example short term trading EURUSD pair: BUY EURUSD if EUR strength is increasing from below against USD strength and future predictions shows up-arrow for EUR and down-arrow for USD. SELL EURUSD if EUR strength is decreasing from above against USD strength and future predictions shows down-arrow for EUR and up-arrow for USD.
Example scalping EURUSD pair: BUY EURUSD if EUR strength is above 0.6, USD strength below -0.6 and future predictions shows up-arrow for EUR and down-arrow for USD. SELL EURUSD if EUR strength is below -0.6, USD strength is above 0.6 and future predictions shows down-arrow for EUR and up-arrow for USD.
Buy currency with strong strength against currency with weak strength.
I am currently analyzing other patterns in currency pairs based on the strength levels. I share this indicator (link below) as I see good potential in it for short-term and scalping trading style. Also other experienced traders can share their thoughts and experience with this indicator.
More examples and trading tips comming soon.......