Ok, this this week I thought I might add some content to this thread by demonstrating how to trade inside Dennis’s Currency Strength and Weakness matrix (Thread here).
Below is the matrix for September 2020… I add currency traces to the matrix on a daily basis which displays in detail what is really happening with each of the Major currencies.
Most times, a currency “crosses” over another (clearly visible when color traces are added), it is an opportunity to trade the movement and enter a small trend or a successfully early entry into a substantial trend… Last week (15th) you can clearly see the cross of a strengthening JPY over weakening EUR… resulting in a 200+ pip win over the following couple of days… Clearly displayed is the JPY’s strength over the preceding 11th and 14th and the EUR weakening over the same period…
The “Edge” of this strategy is the percentages tell the real story… not the positions… have a close look at the EUR… Even though it only moved one spot lower in the matrix, it has actually weakened consistently from the 11th… allowing the opportunity to trade any of the other Majors… strengthening over the same period… Study the image above, comprehend it, and test it against your charts…
Over the week I will show how to select currencies “of interest” and how to apply the strategy described above… 21st… AUD is weakening… noted… and at this current time all other Majors are weakening as well, the JPY against the other 7 Majors is really the only opportunities available.
Lets see tomorrow’s (22nd) result at the close of the US Session and we should have a clearer picture of what the market is going to offer…