Currency strength meters: useful or noise?

Strength meters rank currencies by their performance across pairs, promising to show which to buy and sell at a glance. The rankings are real; the trading signals they generate are less clear.

Currency strength meters: useful or noise? — currency correlation diagram
Two currency pairs moving in and out of correlation

Do you use one?

  • the meter and how you read it
  • the trades it suggested that worked or failed
  • how you combine it with your own analysis
Currency strength meters: useful or noise? — risk-reward diagram
A risk-reward ratio of 1 to 2

The correlation guide explains the cross-pair structure the meters summarise.

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