Currency Index indicator

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Currency Index indicator

Postby robocod » Mon Jul 27, 2015 6:47 am

The Currency Index indicator computes an “index” using an un-weighted geometric mean of several currency pairs. This is similar to the US Dollar Index (USDX) and FXCM’s USDOLLAR. However, it does this, not just for the USD, but for 7 other currencies too. That’s 8 major currencies in total: USD, EUR, GBP, CHF, JPY, AUD, CAD and NZD.

The “index” is computed for one currency at a time, which requires 7 currency pairs. For example, to compute the “USD index” it uses EUR/USD, GBP/USD, USD/CHF, USD/JPY, AUD/USD, USD/CAD and NZD/USD. In the Currency Index I have totally overhauled and optimized the data loading mechanism, so the minimum number of currency pairs is required. This makes it much faster to load, compared to the Currency Strength Meter.

The “index” is normalized so that it has a nominal value of 10000 on 1/1/2011; this is the same as FXCM’s USDOLLAR.

The “index” can be treated as a synthetic instrument (although only close prices are available, there is no high or low). You can perform the majority of standard technical analysis techniques with it, including drawing trend lines, marking support / resistance, etc. as well as using technical indicators such as moving averages, RSI, Bollinger Bands and many others.

screenshot2.png


This indicator is available from my blog and also on the FXCM Apps site.
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robocod
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