One of the other ways of using a tool like this is to overlay it with directional momentum plays via pullback/continuation bets such as those recommended on our thread.
Euro, Kiwi & Sterling have been stable gainers since the open in NZ with Canadian & Aussie $ the laggards. So matching Euro & Sterling up with the laggards has been a fruitful play today for session speculators as well as pullback/continuation punters.
Using the strong/weak relationship to firm up & zone in on strong directional plays would have you dialling into gbpcad, gbpaud and/or euraud.
Reason for filtering those candidates is because all 3 are at the top end of their respective momentum ladders bouncing round numbers/figures in continuation trend mode with plentiful average daily range supply into the european business session – all key trigger components.
A solid (independent) strength meter will have indicated high water marks right through the timeframe ladders on Euro & Sterling & low water marks on Canadian & Australian Dollars right out of the traps in Aukland this morning & through the rolling sessions into Frankfurt, London & New York.
Increasing odds & minimising risk is the name of the game when lining up your skittles, which is where a reliable & solid strength indicator can earn it’s corn.