This morning I posted a "currency strength" indicator that displays the relative strength of each currency, similar to the Hanover indicator we all know. But it sounds like mine is much simpler.
I was experimenting with it a bit, and I came up with something that looks very promising. I don't have the expertise to build it into an EA -- nor do I have the time, I was supposed to be working today, not playing with Empty4 -- so I'll toss it into the ring here and let Steve &etc look at it.
The initial indicator I wrote seemed to work well, but it was pretty noisy:
So I added a smoothing pass that runs the index values through an EMA:
That made it a lot easier to read, and it would be a lot easier to use it for signals in an EA.
I started looking at the direction of the currency indices. In the chart below I have the CAD (orange) and JPY (purple) indices on the indicator, and CADJPY on the chart above it.
The vertical lines are a very rough attempt to mark signals generated by this logic:
* If the lines move in opposite directions, go long (green line) if CAD line is increasing, short (red line) if CAD line is decreasing.
* If the lines move in the same direction, go flat. (white line)
In a quick hand check, it appeared to do a very nice job catching the moves. But that relies on me reading the chart, and of course I'm not as particular as an EA.
Look interesting?
The indi with the smoothing is attached. I know how that saps your will to live, Steve but the important part is fairly straightforward. Just copy AUDUSD, USDCAD, USDCHF, EURUSD, GBPUSD, USDJPY, USDNZD into arrays, then calculate the index values:
Code: Select all
USD = MathPow(UsdChf[i]*UsdJpy[i]*UsdCad[i]/EurUsd[i]/GbpUsd[i]/AudUsd[i],1./7.);
AUDval[i] = USD*AudUsd[i];
CADval[i] = USD/UsdCad[i];
CHFval[i] = USD/UsdChf[i];
EURval[i] = USD*EurUsd[i];
GBPval[i] = USD*GbpUsd[i];
JPYval[i] = USD/UsdJpy[i];
NZDval[i] = USD*NzdUsd[i];
USDval[i] = USD;
Warning: the indi seems to work fine on M1 - H4, but for some reason it goes wonky on D1 and above. I don't know why but I suspect it has to do with nefarious mysteriousness in the way Empty4 loads up the data history.
Gary