Home Page Forums Suggestions Forum Commodity Strength and Longer-Term Volatility

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    Below are a couple of additional ideas for new indicators.

    Strength Indicator for Other Asset Types
    It occurred to me that the basic concept of the Currency Strength Indicator could be extended in two ways:

    (1) Taking the indicator as is, but populating it with other contracts to achieve a sibling product i.e. a Commodity Strength Indicator that shows the dynamic interplay between the likes of gold, silver, copper and oil. This could help a lot with considering potential pairs trades.

    (2) A fusion of the above concept with the data from the existing CSI, in order to see relationships within the commodity complex. E.g. “how is AUD’s strength, compared to Gold strength at the moment?”

    (3) Similar to (2) above but with a focus on the FX/indices interplay e.g. “how is Yen’s strength, compared to the Nikkei 225 and S&P 500 right now?”

    Volatility Matrix
    The existing Volatility indicator is very helpful in quickly gaining an appreciation of volatility, up close. It occurred to me it would also be helpful to see a more pulled back picture of volatility, across the twenty-eight FX pairs currently in-scope for other indicators. In this way aiding the user to get a sense of the “sea state” before they trade; and helping to inform decisions such as a) whether the current level of volatility suits their trading style and strategy and b) how wide stops should be.

    Possibly this could be represented in a manner similar to the current Currency Matrix, but with the leader board representing both i) current degree of volatility and ii) the level of change this is undergoing, relative to the pair’s normal level of volatility. (Without this latter element of course then some candidates, such as GBPJPY would always be toward the top of the board).




    Hello Peter – thank you for your additional ideas and comments which are appreciated and indeed the first of these is one that has been in our minds for some time. Having a commodity strength index based off the commodity currencies and related to the commodities themselves is an excellent idea and will certainly be one we will consider for development in the future. And as is the volatility matrix which we could perhaps consider along the lines of the new curenncy heatmap across the time horizons. All possible and excellent suggestions so thank you for these, and even more so as we move into the MT5 arena next year. Thanks again and thank you for taking the time to post your ideas.

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