A currency strength indicator or currency strength meter is one of the most useful and also most simple indicators you can use.
In it’s simplest forms this indicator can tell you how strong one currency is against another currency. For example; is the Euro stronger than the US Dollar or is it weaker? Having this knowledge can help you workout if it is a good time to buy or sell or just sit on the sidelines.
In this post we go through exactly what the currency strength indicator is and how you can use it in your MT4 and MT5 charts.
NOTE: Want a full list of some of the best free MT4 and MT5 indicators you can use in your trading? You can get them below.
Table of Contents
What is the Currency Strength Indicator?
The currency strength indicator will be able to quickly tell you if one currency is stronger than another currency.
This is a very simple indicator that will show you where one currency is stronger than another currency or where the momentum is flat. This knowledge can be incredibly useful for not only making new trades, but for also managing your open trades.
There are different strength meters out there and they all get calculated in different ways, but the best ones do this by taking readings against multiple currencies and not just against one.
The best currency strength indicators will also give you simple and clear buy and sell signals. As you can see from the chart below, the indicator used in this example gives clear buy and sell signals with green and red arrows.
How to Use the Currency Strength Meter?
The indicator used in the example below gives both clear buy and sell signals and also lines to show a currencies strength.
When monitoring these lines you are looking to see what direction they are moving in and what they are showing you.
If a line starts moving higher it is showing strength. If a line starts moving lower it is showing weakness. As you can see in the example below the USD (red line) is above the CAD (green line). This shows us that the USD is stronger because it is above the CAD line. These readings will be different for each particular time frame you use the indicator on.
The best moves and trades will be found when you see the strength of the currencies diverging. For example, the best trades will be found when one currency is getting much stronger and another currency is getting much weaker.
If you are using an indicator like the one used in the example below you will be able to see one line strongly moving higher and another line strongly moving lower showing one currency is clearly stronger than the other.
Currency Strength Indicator MT4
This MT4 currency strength indicator is from EarnForex and is free to download and use.
This indicator is very simple to use and it is incredibly handy. Once downloaded you can add it to your charts and you will be able to quickly see the strength or weakness of your chosen currency.
You can use this indicator to find new trades, manage open trades and also see if a trend is starting or looking to end.
MT4 Currency Strength Meter Features
- Custom built algorithm to detect a currencies strength and weakness.
- Strength and weakness detected over multiple currencies.
- You can adjust the sensitivity to your liking.
- Easy to use entry and exit signals.
- Built in alerts and notifications.
- Can be used on multiple time frames.
You can get the MT4 Currency Strength Indicator Here
Currency Strength Indicator MT5
This is another currency strength meter by EarnForex that is also free to download and use in your MT5 charts.
This is a very useful indicator that is easy to use and will quickly help you spot a currencies strength or weakness.
Just like the MT4 version of this indicator, this indicator can be used to see when a trend is starting or looking to end, manage any open trades or make new trades.
MT5 Currency Strength Meter Features
- Custom built algorithm to detect a currencies strength and weakness.
- Strength and weakness detected over multiple currencies.
- You can adjust the sensitivity to your liking.
- Easy to use entry and exit signals.
- Built in alerts and notifications.
- Can be used on multiple time frames.
You can get the MT5 Currency Strength Indicator Here
