AUD, then the best choice would be to SELL AUDNZD since NZD is at 8. 50 pips more than just selecting a default pair, such as the AUDUSD. How Does The Meter Calculate Currency Strength? Then divide by Number of Pairs. Amount of pips this pair is at in reference to the daily range. 3500 and the daily range is 1. 3550, this figure would be 50.
Low range for the currency pair. 3550, the daily range would be 100. Once you get the reading and based on the pair, you’d multiply that using Bank of International settlement Forex volume distribution list to get the right weight. Repeat this process for every pair that contains your currency. For instance, the reading of EUR will require the meter to repeat the process 7 times: EURUSD, EURGBP, EURCHF, EURJPY, EURAUD, EURCAD, EURNZD. Finally, you take the average reading and divide the result by the number of pairs, which is 7. You repeat the same process for all 8 majors.
You also have to keep in mind for reverse calculations as per the naming convention, because sometimes your currency could be either the base or quote currency in a pair, like USD is to USDJPY and EURUSD. The meter does about 112 calculations per each reading, which is lightning fast considering the amount of pairs it has to go through. Make sure to watch my above videos and don’t forget to share with me how are you using my CSM. My name is Henry Liu and I am a Forex Trader and Mentor.