Currency correlation trading system

Dealing Desk. Demo Account. Depth of Market. Donchian Channel. Durable Goods Order. Escrow Account. European Central Bank.

HOW CURRENCY CORRELATION HELPS YOU TRADE PROFITABLY

European Monetary Unit. European Union. Factory Orders. Fed Meetings. Federal Deposit Insurance Corporation. Federal Funds Rate. Federal Open Market Committee. Federal Reserve. Federal Reserve Board. Fiscal Policy. Flexible Exchange Rate. Foreign Exchange. Foreign Exchange Center.

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Types of Correlation

Great Britain Pound. Gross Domestic Product. Gross National Product. Hometrack Housing Survey. Industrial Production. The trade arrows and signal alarm will occur any time the first bar of the histogram appears, which means you can set it to signal only during times of correlation if you want. UpperLevel is the scale above zero and LowerLevel is the scale below zero and you must use negative numbers for the LowerLevel. The Minimum Strength helps filter out weak false signals during choppy low-volatility market conditions.

When the Histogram appears, you ge an Entry Arrow on the chart. When the histogram stops or changes color, you get an Exit Arrow on the chart, but this would be the simplest use of this indicator.

There are many more strategies it can be used for, as you will see in the coming EAs that auto-trade off of this indicator. Trade Arrows: The Trade Entry arrows appear in the larger candlestick area of the chart when the Histogram appears and purple Exit Stars appear when the Histogram stops. You have the option to reverse the trade arrow direction and also hide the arrows if you don't want to see them.

Correlation Required for Histogram. TradePair: This is the currency pair your indicator should be attached to. If you are running the EA, this is the pair that will be traded based on the indicator signals Click Here to see the EAs. They can either be displayed or hidden in the indicator field.

Correlation Pair Settings. Multipliers: This is just a simple way to convert the moving average values into pips from each correlation pair's prices. To keep it simple, set all JPY cross pairs to 90 or and all other currency pairs to However, it can also be used to apply more or less weight to a correlation pair's pip value and hence, it's IMA value.

You just flip one upside down and they will now correlate in your indicator. The reverse variables allow you to do this by flipping that pair's IMA value, turning a positive value into negative and negative into a positive.

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With this indicator, you can now create an average trend between them. This allows you to see the market in ways you've never seen before and ways most people never will! See example below. This is important if you are comparing stocks, Indices, or CFDs that trade on exchanges that close daily in it's country's time zone. Currency pairs on the Forex Spot market run on the same 24 hour schedule 6 days a week so their market hours always match. However, it's important that none of the correlation pairs have gaps in their historical data, otherwise, it will throw it's values off and you will need to replace any missing candles manually or find a cleaner data source to get the most accurate historical indicator readings for manually backtesting your strategy.

It cannot be backtested in the strategy tester.

They are on the same exchange so their trading hours match. Since their prices are very different and the indicator calculates values in points rather than percentages, simply divide the higher priced asset by the lower priced asset. Enter the sum into the Multiplier field of the lower priced asset and enter 1. The preset file used in this screenshot is included in your purchase as an example you can follow.

Here I am comparing Gold and Silver to get an average trend direction. Notice the average trend predicted the drop before it happened. Since Gold and Silver are much different prices, I divided the price of Gold by the price of Silver and got a sum of The preset file used in this screenshot is included in your purchase. To get you off to a running start and to save you a lot of time , I am including most of the settings used on this webpage. The following Preset files are included with your purchase. If you don't, the indicator will give you an error message stating you do not have enough data for the correlation.

You do not need to keep these other charts open to run the indicator in real time. The indicator instructs MT4 to load the data internally but I like to keep the correlation charts open so I know for certain they are updating in real time. Risk Disclosure: This website does not guarantee income at any time, nor success of the product beyond the specific day performance guarantees for each product.

There are many factors that can effect each person's individual results. Examples shown in this presentation do not represent an indication of future success or earnings but merely hypothetical historical performance based on specific trading models. Past performance is not indicative of future results and individual results will vary. The company declares the information shared is true and accurate.

Government Required Disclosure - Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite.

The example is literally the same for any two positively correlated trading assets or currency pairs that suddenly experience a divergence in prices between them. With the mentioned pairs, the trader can then look our for the price divergence between them, and then be prepared to take swift advantage of such unique trading opportunity. The trader using the Currency Pair Correlation Indicator can then search for when the prices of each of the trading assets or currency pairs are either moving in the same direction together or when they are both moving in completely opposite directions.

Traders would then need to determine to which degree these correlations and divergences are happening and take advantages of the most obvious and or the largest moves. My trading career started in Since I have helped thousands of traders to take their trading to the next level. Many of them are now constantly profitable traders. The following performance was achieved by me while trading live in front of hundreds of my clients :. Connect With Me:.