For analyzing the best pairs to trade looking from a longer term perspective the last 3 months Currency Classification can be used in support.
This was updated on 10 July 2016 and is provided here for reference purposes:
Strong: USD, JPY, NZD. The preferred range is from 6 to 8.
Average: CHF, CAD. The preferred range is from 5 to 6.
Weak: EUR, AUD, GBP. The preferred range is from 1 to 3.
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13 Weeks Currency Score Strength
The 13 Weeks Currency Strength and the 13 Weeks Average are provided here below. This data and the “3 months currency classification” are considered for deciding on the preferred range. Because it is not ideal nor desired to change the range for a currency every single week, we perform several checks to avoid this.
In the previous article we looked into the EUR and this weekend the currency has again a score of 2. In the last 5 weeks it had a score of just 2, which is a value for a weak currency in that specific period(Week). This moves the 13 weeks average down to a value of 3,4615 currently. This value is far from the other average currencies, the CHF and the CAD. It is at the same time a value close to the AUD which is a weak currency. The EUR had 7 weeks a lower score compared to the AUD in the last 13 weeks. The EUR has become for this reason a weak currency, here below you can see the weak currencies.
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Currency Score Comparison