This is incorrect, the value for JPY is not derived from the value of the other currencies in the comparison. JPY is the point of reference and its value is 0 because that’s how it was defined by Dennis
If you wanted JPY to hava a value other than 0, you could change how its defined, with the corresponding changes in the formula used by Dennis or change your point of reference to any other thing, ex: Gold
Exactly, that’s what the guy I replied to was asking for.
That was the idea, thanks.
I’d be cautious going long against JPY at the moment. USA and China looking like they might be having second waves of the virus and global GDP numbers coming in even worse than expected is looking like the safe havens could have another run. I’d be short AUDJPY right now if I didn’t think it was far too risky leaving trades open over the weekend at the moment.
It appears of late the currency strengths are rallying strength from the economic and/or health of their region of origin… ie: Australia and New Zealand have come away from the pandemic with their populations pretty much unscathed when compared to the major currency countries, hence the AUD and NZD have been at the pointy end of Dennis’s matrix when they shot to the top back on April 9th… and have remained there ever since with the exception of NZD which had a week or two in the wilderness…
I brought this up with Dennis on 10th April…see post here… and 60 days on it now appears to be the case.
Back in March AUD and NZD where dragging on the tables as we were the first to feel the effects of the pandemic, possibly due to proximity and reliance on the Chinese for goods and tourism… Once both oceanic economies had locked down hard the focus shifted to the carnage in Europe…
At that time (Mid April) Italy and Spain’s health systems were being devastated by the Virus and the EUR was on the canvas… A few weeks later the pandemic ramped up in the UK and the GBP fell to last place.
Now we have the USD on its knees with major civil disobedience issues and a raging death toll from the pandemic which started the USD’s descent to the floor two weeks ago when the flare up began…
Coincidence…?? I think not… I have been trading the pandemic’s fundamentals with profitable results over the last 6 weeks or so… as contrarian trading the NZDJPY and other majors against the strength of the AUD and NZD as demonstrated in May…
The JPY has shown to be a very fluid player… moving up and down the Currency Strengths almost like a metronome. Japan could be a major winner or loser out of what happens next with China.
Edit: Above is displayed in Dennis’s Data Mapped over March, April, May & June…
Thank you for your responses. But I think you got my question wrong. Yes, I know that JPY is set as default and has a constant 0%. With this JPY only moves in the rankings with constant 0%. This is just fine if we we are after for the day’s ranking for strength/weakness. My question is if you can observe the excel record of sir Dennis wherein you can observe that other currencies do change in percentage and rankings as well. Am just curious if there is a way to reflect the changes in JPY this time between days, this cannot be done if it is always in zero. As i understand, sir Dennis can see the pullback going on if for example AUD as the strongest suddenly goes down in percentage even if maintaining its ranking as the strongest. If this can be observe for other currencies, then how about the JPY, how can we see the pullbacks?
Have you tried out the formula?
Take for example Dennis’ rankings for the 10 and 11 of June. JPY hasn’t changed position, it stayed 7th on both days. Using the formula you will find out if it has gotten stronger or weaker from one day to another.
10 June : 5,45 + 5,38 + 3,26 + 3,03 + 2,52 + 2,19 + (−0,29) = 21,54 / 7 * (-1) = -3,08%
11 June : 3,23 + 2,77 + 2,09 + 1,78 + 1,05 + 0,99 + (−0,54) = 11,37 / 7 * (-1) = -1,62%
The YEN has gained in strength (on average) from 10 to 11 June, even if the ranking has stayed the same. It went from -3,08% to -1,62% on average. You can easily check on the charts that this was the case.
Last week we saw a big reversal in stocks taking out all previous weeks gains and looking at our SW rankings currencies followed stocks but with such a wide gap between strong and weak we did not see much of a change in the rankings, Looking at current top trade NZDUSD this pair is down about 80 pips from its entry point, to soon to tell if this is just a pullback and trend change
What I would like to see Monday is a selloff in the morning followed by a strong rally into the close, If we get that then our trends may continue, for now, I am taking a wait a see
I am not getting what you are after either, NZD is currently at 3.86, Yen is at 0.00, If you reversed it and used NZD as your base currency you would have the Yen at minus 3.86 and NZD would be 0.00. Richard Krivo the man who introduced me to a SW ranking only listed his SW in a rank order, I added the percentage to my rankings so we can see when trends change even if the rank order has not
I hope this helps
Big tango! You got my point. And i appreciate your approach that the way to get the relative strength/weakness of JPY per day is to compare the average of all currencies per day since the reference of the strength meter is JPY.
On Sunday I said
“What I would like to see Monday is a selloff in the morning followed by a strong rally into the close”
we did get that opening gap lower followed by a really, that is a good start to the week, but was it enough to get our SW trends back on track, see my next post
Top Trade NZDUSD is still below its entry but maybe the pullback is over, look at the 1hr chart price is testing the 200ma, a full candle close above that ma would be a good place to go long with a tight stop just below the 200
Top trade AUDJPY also looks ready to move higher, still some overhead resistance to takeout then watch out
we had a strong Yen on a day that saw US stocks up 2%, normally Yen is down when stocks are up but nothing in this world is normal anymore
I don’t know why yesterdays ranking did not post, so let’s try it again
The market continues to consolidate, the distance between strong and weak is contracting
With that said we did get a big drop in GBP today and with GBP and USD only a few fractions apart we could view GBPNZD* as a new strong-weak trade, and looking at the chart below we see a new low today so the trend points lower. GBPNZD is not one I trade but if you do it is worth a look
Great observations Dennis.
I would also like to throw out GBPAUD as a potentially good pair to look at as well. During these times of reversals, i tend to look at the 2nd to lowest, and 2 to highest pairs to see how they doing.
US stock market looks like it’s going sideways as well. All this normal “not normal times” has really let us seen interesting combinations of the markets.
Quick question for anyone on the forum regards to the current top trade.
It is Fathers day so I am going to chill out, we can talk about the markets tomorrow
After another weekend of nothing but bad news about the economy, we hit the ground running with an up stock market and bullish reversal in yen pairs. Looking at NZDUSD, this pair is back on top and still is below its entry point but that is a very bullish engulfing candle and should head higher,
A small gain in our Top Trade. with all the money printing here in the US, I would expect dollar weakness to continue for a while longer
We have a back and forth market and today we went back, US markets also had a big down day, now will that continue, tune in tomorrow
It looks like all pairs have gone under the 2% rule of strength/weakness differences. I believe that we have entered the “sideways/consolidation” phase of the year. Time to wait!
