Currency Strength Meter Explained

Let me take this opportunity to explain what Currency Strength Meter (CSM) is and how to take advantage of this amazing little tool, because once you start using it, you won’t take another trade without it! Here’s a brief description of CSM: a standalone program that calculates over 30+ currency pairs in real time and displays an at-a-glance view of the strengths and weaknesses of all major currencies, namely the USD, EUR, GBP, CHF, AUD, JPY, and NZD. The Strength readings vary from 0.0 to 9.0, with 0.0 being the weakest and 9.0 being the strongest (CSM 3.0.6 pictured below).

meter1 Currency Strength Meter Explained

The color code used in the meter is pretty self-explanatory, with:

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BLUE as weak (0.0 ~ 2.0)
YELLOW as normal (2.1 ~ 5.0)
ORANGE as strong (5.1 ~ 7.0)
RED as critical (7.1 ~ 9.0).

How To Use Currency Strength Meter?

There are many uses for the CSM, watch videos above to find out more:

One of the best uses for me is to gauge market condition before and after an economic news release. I like to look at the market and try to find the best pair(s) to trade prior to the release; for instance, look at the meter below (CSM 3.0.6 shown):

meteronly Currency Strength Meter Explained

Now let’s say we are getting the Australian Retail Sales figure in just under 5 minutes, and the meter is showing AUD reading at a 6.8. If the news comes out favoring AUD, the best choice would be to BUY AUDCHF, since it has the best match up, with AUD at 6.80 and CHF at 3.00; if the news is negative for AUD, then the best choice would be to SELL AUDNZD since NZD is at 8.0.

By adjusting the pairs you trade during news releases, you can definitely add 10 ~50 pips more than just selecting a default pair, such as the AUDUSD.

How Does The Meter Calculate Currency Strength?

Here’s a quick formula on how the meter is calculated…

(PIPS / [DAILY HIGH-LOW] ) * BIS Weighted Formula + (PIPS / [DAILY HIGH-LOW] ) * BIS Weighted Formula… Then divide by Number of Pairs.

PIPS = Amount of pips this pair is at in reference to the daily range. If EURUSD is at 1.3500 and the daily range is 1.3450 to 1.3550, this figure would be 50.

Daily HIGH-LOW = This is the Daily High/Low range for the currency pair. If EURUSD’s low is 1.3450 and high is 1.3550, the daily range would be 100. The daily range is calculated from 5:00pm EST to 4:59pm EST 24 hour period, standard day for the Forex market,

BIS Weighted Formula = Once you get the reading and based on the pair, you’d multiply that using Bank of International settlement Forex volume distribution list to get the right weight.

+ = Repeat this process for every pair that contains your currency. For instance, the reading of EUR will require the meter to repeat the process 7 times: EURUSD, EURGBP, EURCHF, EURJPY, EURAUD, EURCAD, EURNZD.

Finally, you take the average reading and divide the result by the number of pairs, which is 7.

You repeat the same process for all 8 majors. You also have to keep in mind for reverse calculations as per the naming convention, because sometimes your currency could be either the base or quote currency in a pair, like USD is to USDJPY and EURUSD.

The meter does about 112 calculations per each reading, which is lightning fast considering the amount of pairs it has to go through. The advantage is that it can pinpoint you to the best pair(s) to trade by identifying both weak and strong currencies.

Make sure to watch my above videos and don’t forget to share with me how are you using my CSM.

 

Thanks,

 

henry sig Currency Strength Meter Explained

Avatar of Henry Liu About Henry Liu

My name is Henry Liu and I am a Forex Trader and Mentor. I help traders achieve consistent income trading Forex while spending less time trading. My focus in trading is a combination of Fundamental Analysis, Technical Analysis, and Market Sentiment. Far too many retail Forex traders concentrate on just one aspect of trading, technical analysis, and ignore everything else; it is my goal (and vision) to educate every trader on how to take advantage of news trading and become more balanced traders.

You can find more information about me on my Google Profile.

Comments

  1. Avatar of ArpadArpad says:

    Hi Henry and Kelvin,

    I really appreciate all the valuable info here on your website.
    It’s really awesome.
    The CSM is also very helpful.

    Although I think there is a fundamental flaw of it.
    While the red and the orange ranges are 2 points wide (9-7 and 7-5), the yellow range is 3 points wide (between 2-5).
    So there is some distortion in the data this way.
    What do you think?

    Thanks,
    Arpad

  2. Hi, my CSM has stopped working. Problem Event Name: CLR20r3
    I can’t uninstall / install. Can you help me

    Thank you

  3. Hi, Henry and Kevin, kindly help me with CNT, i downloaded it and it went through but the registration is not going through, therefore it is not working yet.

    I had uninstall and reinstall and still the error message of “There is a problem with connection”

    Please is this from your end-server or my stsyem?

    Expecting your reply.

    Thanks

    • Hi Simeon, we apologize for the inconvenience but this is a known issue and it will be fixed in the next update. Try reinstalling CSM again; if still unsuccessful, use the CSM web version located in our home page.

  4. Avatar of VijianVijian says:

    hello mr liu,the guru,pls sir the new CNT i download could not install although I followed the advanced installation guide. thanks

  5. There is some problem in registering the CSM “There is some problem with the connection” is the caution. plz guide me to fix it.

  6. Avatar of omaromar says:

    i cant download currency strength meter can you help me pls

  7. Avatar of emmy_0422emmy_0422 says:

    Thanks Mr Henry and Kelvin. this is another indicator, I think this will help me alot, though , I have not started trading. God bless you

  8. Avatar of ClaudioClaudio says:

    Hi I’d just like to are the values calculated on a daily basis?

    Is it possible to get daily, weekly and monthly?

  9. Avatar of LinnaLinna says:

    Thank you Henry, this meter is like a compass to me. It has helped reduced two losses : my sense of mental loss, and monetary losses. I trade better now. Thank you.

  10. please where is the download link?

  11. Please, can someone please help me out, I’ve been trying to download this CSM for the past one week now, is there any special web for it?

  12. Avatar of nasruLnasruL says:

    May i know, it get calculated data from our mt4 or from ur server?

  13. Hi, mr.henry, how can I get CSM 3.0.6 download on my IPad. Thank.

  14. Avatar of EzraEzra says:

    I downloaded CSM 3.0.6, tried to register but it keeps saying “There is some problem with connection.” I re-installed it again about 3 times still the same, how do I fix this?

    • Hi Ezra, we apologize as this is a known issue that happens to some users. Try on a different computer or use the web version located in our home page; we are working to have this issue fixed on the next update.

  15. Avatar of guritnoguritno says:

    already downloaded and used the CSM for a day, but somehow it doesn’t work out in the next day…
    try to re install but stuck in the registration window, the “there is a problem with the connection” comes up and currency strenght meter in your site on the right sidebar also disappear ,
    any solution sir ?

    • The CSM server was down for maintenance this past weekend, which could explain why you couldn’t register the 2nd time around. Please try again, but if you are still unsuccessful, the you would have to use the web version located in our home page.

  16. Avatar of RadaRada says:

    Hello came across this site thank you for making all this available – the CSM, CNT EA, and the forex education etc., will take advantage of this information to improve as a trader. Kind Regards. Happpy Pippin to all :)

  17. Avatar of DougDoug says:

    Hi Henry,
    Thanks for the great SCM tool. I watched your video and you asked on there that if anyone had any other way they are using this tool to let you know. I use it in conjunction with the super channel.ex4 indicator. This indicator is a great way of determining support and resistance for each time frame and when used with CSM it is a great way to determine trade entry and exit points. For example if see say JPY is around 7 or 8 and GBP is around 2.5 then I take a look at that chart with the super channels on it, I look at each time frame from 1 minute up to 4 hours and see if the super channel trend matches for each time frame. If they do and CSM indicates a trade in the direction of the trend then I look for the best price to place a trade. This is a bit of a simplification and I have several other indicators that I look at to see if things line up, but CSM has become a major tool I use for my trading. I find it to be a great indicator of market conditions and seems to be very accurate. Thanks for a really great tool!
    -Doug

  18. Kelvin , there isn’t a mobile version for the Meter , is there?

  19. Hi Henry, in a previous answer you said me “PIPS is the amount of pips a currency pair is at the current time in reference to the daily range. For example, If EURUSD is currently at 1.3500 and the daily range is between 1.3450 to 1.3550, then the PIPS figure would be 50″, but the example confuses me, the result where did 50 come from?, is the high minus the current price, or do you minus the current low value? Thanks.

  20. yes, its me again, i am finally able to get to your page, my csm 3.0.6 has not worked for the past 5 hours.

  21. Avatar of amiryounasamiryounas says:

    Hello,
    I Install CSM but when i register it it replied THERE IS SOME PROBLEM WITH CONNECTION.And i m trying this daily but i don’t know that this is which type of software.?

  22. Avatar of Barbara FBarbara F says:

    It still says there is some problem with connection, when I try to register.
    It is 10:50 am est. 12/3/13.
    I’ve been trying for a few days to register.
    Any idea when this will be fixed?
    Thanx.

  23. Avatar of JimJim says:

    Hi All, Afraid my CSM crashed out as the 5min alarm went off and locked my whole computer. Just would like to know if it is my computer or if there was a problem.

  24. Hi guys. I’m having problems with the CSM – just showing red and blue squares – no values, no mid-range. Can you please advise if there’s a server problem?

  25. Avatar of RayW86RayW86 says:

    Does the meter operate under Windows 8? Like others have noted earlier today the registration process is failing to-day. I need to re-download due to a windows 7 pc failure. It worked fine on it but I cannot register it on the new Windows 8 machine.

  26. Hi Henry,

    Have had this before, and LOVED IT, but now, when I download the CSM, and Register, it says it can’t make a connection ?? I’m ONLINE, dont’ understand. Tried removing, and re-downloading, didn’t work. Can you help?? I love this thing. Thanks

  27. Avatar of PatrickPatrick says:

    The meter seems to be malfunctioned? All the numbers are blank on Dec 01, 8:18pm EST.

  28. I watched the series of 4 videos from CompleteCurrencyTrader.com. A very interesting presentation on currency strength, but when I got to the bottom line they were selling software to show currency strength costing $10,000 (might have been £10,000) Anyway V. overpriced in my opinion.
    So I searched for a strength indicator and found CNT and your Currency Strength Meter. Downloaded smoothly and is now working on my PC and FREE !!. Thanks guys, lots of interesting stuff on your website, so I hope the start of a useful relationship.

  29. Where do I can see the Bank of International settlement Forex volume distribution list. Thanks.

  30. Avatar of rezareza says:

    Hi

    I can’t see any download link for CSM , How download?

    tanks

  31. Hi, Mr. Henry. Why can’t I upadate/ refresh the online CSM that is on the right side bar of this page, even after I click “refresh meter”. The information given is just still the same for the whole day. Thank you, Mr. Henry.

  32. Avatar of KornelKornel says:

    What pairs do you use to calculate CSM values? I have only this pairs in MarketWatch, but CNT shows quite different values:
    AUDCAD, AUDCHF, EURAUD, GBPAUD, AUDJPY, AUDNZD, AUDUSD,
    CADCHF, EURCAD, GBPCAD, CADJPY, NZDCAD, USDCAD,
    EURCHF, GBPCHF, CHFJPY, NZDCHF, USDCHF,
    EURGBP, EURJPY, EURNZD, EURUSD,
    GBPJPY, GBPNZD, GBPUSD,
    NZDJPY, NZDUSD,
    USDJPY.
    Do you use more or less pairs? If yes, which are the differences?
    Regards, Kornel

    • Hi Komel, the CNT dynamic strength indicator uses all available pairs in your MT4′s market watch. In regards to why the values may be slightly different, please click on the following link for answer: http://www.currencynewstrading.com/questions/different-figures-between-csm-and-cnt-ea/

      • Avatar of KornelKornel says:

        Hello Kelvin,
        Thank you for your answer, I had read that post. You wrote “You could remove some exotic pairs from the market watch window if possible.”, so I removed all exotic pairs, like HKD, SEK, NOK, CZK, HUF… So the above mentioned 28 pairs remained in the MT4′s market watch. Now CSM shows EUR = 4,70 and JPY = 6,50; but the EA shows EUR = 6,50 and JPY = 3,90. The time zone is ajdusted correctly, So I still would liket to know which pairs the CSM use to calculate it’s values.
        Regards,
        Kornel

    • Avatar of ColinColin says:

      I have been unable to download the strength meter. It will not open up. Please help,
      Thank you

      • Hi Colin, was it working before? Were you able to register successfully after you completed installation? The CSM does have an issue with registration after you complete the setup; so if you are having this issue, try re-installing it> If you do have the registration problem, we are working on a fix for the next update; in the meantime, you’d have to use the web version of the CSM in the home page.

  33. Avatar of GursimranGursimran says:

    today at the start of asian session the CHF was orange in color around 5. USD was in yellow around 3. still usd/chf was gaining strength even in the london session. why is that so?

  34. Avatar of GursimranGursimran says:

    till yesterday i was on a losing streak. i was about to blow my fourth account. but then someone guided me to your site and had a look at CSM. wow it completely changed on how i used to trade. now at support and resistance levels i know what the sentiments are and plan accordingly.

    good bless you Mr. Liu

  35. Avatar of RickRick says:

    I should have said I am NOT sure what critical means. Does it mean it is so strong that it should be bought or that it will probably drop and should be sold? Can you help?

  36. i can’t register from the software with message “there is some problem with connection”..

    • Hi Bobby, unfortunately this is a known issue that in some computers you may experience the connection problem. We will have this issue fixed for the next update but in the meantime, you may use the web version in our home page.

  37. Avatar of PeterPeter says:

    Am I correct in saying that no matter whether it is a Buy OR Sell trade, that the 1st currency in the pair needs to have a higher value than the 2nd currency on the “Currency Strength Meter”??

    Cheers Peter

  38. Avatar of babsonbabson says:

    HI,HOW DO I GET A LINK TO YOUR MONTHLY SIGNALS SUBSCRIPTION AND HOW MUCH DOES IT COST

  39. Would it be possible to add a new option to select weekly strength rather than just daily strength. Sometimes its good to know if the currency has strengthened over the past whole week.

  40. Avatar of TalalTalal says:

    First of all thank you very much, for the effort you putting guys, i dont know is it just me or this is happening to everyone i couldnt find email from you when i register in the beginning but in junk mail so you might guys want to refer this to new users or how to be solved and second issue is the activation key was valid!

    for the meter i really love it i used to use it while ago just small request can we put more option for the alert (ex. 5, 10, 15 min)
    i dont know if it has been discussed as many traders now using mobile and ipad app do you ever think of lunch it in app-store and android too? as they do have in android multitasking feature.

    Thank you so much henery & kelvin

  41. Avatar of kayzkayz says:

    Henry,
    Your CSM is wonderful no doubt.it has bin helpful so far. The little challenge i have is i cant trade the news cos the time on the currency meter is +1 . I mean the time count on my CSM is +1. assuming a news is coming at 1PM. it will be coming as 2PM on my CSM and the same thing is happening to my CNT EA placing a trade a hour after the times has taken place.i tried the changing the server time and logging in the correct user name and password. i have also tried removing it and re installing it but no positive result. pls help.
    i am using forextime platform and windows 7 ultimate.

  42. Avatar of RAVIRAVI says:

    Whether NetProfiteer Meter is good because your CSM is not at all installing on any of the OS..I have tried Windows XP,Vista but the problem still the same saying error “There is some problem with connection”..Either you release the new working version soon or try to fix this bug which lots of peoples are facing..Waiting for comment soon

    • Avatar of Henry LiuHenry Liu says:

      Ravi sorry about the issues you are having. There are some fundamental issues with the software because it’s depedent on google and other 3rd party softwares that change their API periodically. We are moving away from using 3rd party and recreating everything from the ground up, so it may take some time. There are no quick fixes for the time being and we will need to release a new version. The plan to release is before September. Thanks for your patience.

  43. Avatar of mahdiyemahdiye says:

    It is awesome indicator! Thank you so much dear Henry.

  44. What a pity you don’t have Mac version. Cross-platform Java version would be better.

  45. Avatar of FabianFabian says:

    Hi Henry, thanks for your hard work and the awesome CSM :) – Are you happy for me to run the CNT on a Demo and Live account at the same time? – cheers

  46. Avatar of BobBob says:

    Henry. I notice a difference between the CSM and the meter in CNT_EA. Around the Euro open today these were the readings for Aud and Usd
    CSM AUD 2.8 USD 4.6
    CNT_EA AUD 4.6 USD 2.4
    Should this be happening? I presume the CSM should be the one to follow.

    • Hi Bob, did you set the CNT EA with the correct ServerTimeOffset according to your broker server time. Often times, the strength values could be somewhat different, but the relative strength between the currencies should in most cases very similar. The CNT EA works with all of the currency pairs available in your MT4 market watch window. You could remove some exotic pairs from the market watch window if possible. If you are trading manually, you should follow the CSM, whereas the strength meter in the CNT EA is for the EA.

  47. Hi Henry yes I cant get the currency neter to run ,keeps saying theres no connection. Have you been able to rectify the problem. Two other friends have downloaded it ok and can run it. Obviously a windows configeration issue ( I think)

    Cheers
    Bruce

    • Hi Bruce, we are aware of this issue and apologize for the inconvenience. We will have this issue fixed for the next release. In the meantime, please try installing CSM on a different computer or use the CSM web version located in the home page of currencynewstrading.com

  48. Avatar of MikeS(Tex)MikeS(Tex) says:

    Henry, the CSM has been working great up until a week ago. I still get the currency strength vertical bars, the news bar but the News tab on the right always gives me “No News for the time being”. Even during major announcements like NFP coming up on Friday. I reloaded it and still the same results. Am I doing something wrong?

  49. hello, this is not appearing, the news in the currency strength? no news for the time being?

  50. Avatar of FXAnnFXAnn says:

    How do I download the CSM? I looked for a download button after watching the video but to no avail?

  51. Avatar of pipshunterpipshunter says:

    i have download and install the currency meter. However when I start the software it is asking me to register which I did but i am getting this error when i press the submit button ” There is some problem with the connection”

  52. Avatar of FernandoFernando says:

    hey Henry any change to pay with visa my montly subscription.. as l have problem with pay pal account..

    thank you

    Fernando

  53. Avatar of jackjack says:

    hi i really like this site, because i can interact with other FX traders, i will like to know where i can download the currency strength meter

  54. Avatar of GideoGideo says:

    I have just downloaded the CSM but having the error message on activation something about no connection or Connection Error.

    I suppose it is something I am doing wrong.

    Any ideas of what could help me to utilize this program?

    Regards

    • Hi Gideo, this is a known issue and we’ll have a fix for it on the next release. In the meantime, try re-downloading and reinstalling the CSM; or try on a different computer if available. If everything fails, then you can use the CSM web version located on the CNT website.

  55. Avatar of BBbigBBbig says:

    Why EA was Expired ??

  56. SIR CAN I USE VPS WITH CNT EA? AND HOW CAN I GET VPS FROM U?

  57. Avatar of pratheeshpratheesh says:

    Dear Henry

    Your currency meter is superb that is helping me a lot for successful trading

  58. Avatar of onas dinaonas dina says:

    The market is crazily ranging

  59. Avatar of Wes FordWes Ford says:

    I have been having some issues with the registration process in activating my desktop CSM, it is having a connection problem. I have ran it as administrator, made exceptions for the firewall and even turned of the firewall and everything I can think of…I seen some other people have had this issue and was wondering if there has been a fix for this?

  60. Avatar of YongyutYongyut says:

    Thank you

  61. How do I download your currency metre. I have been trying for ages but all I seem to get is advertisments.
    Please…..just tell me how what I need to do !!!!!!!

  62. Avatar of SamuelSamuel says:

    Pls, Have been trying to install the CSM for some time now & it’s being giving me an error message “The is a problem with connection”
    Can someone help on how I can resole it. Expecting your reply.
    Thanks.

    • Hi Samuel, we apologize for the inconvenience; we are working to fix this issue in the nex release. In the meantime, you can use the CSM web version on our website, located on the right sidebar of our home page and other pages.

  63. Hi, I got a problem with my CSM since last week. Sometimes, it’s just freeze, mostly when one currency reach 0.00 on the CSM.

  64. Hi, I’ve seen comments about a known problem, not being able to “connect” to the meter. I have left this for some weeks but still can’t connect?

    • Avatar of Henry LiuHenry Liu says:

      Not being able to connect refers to the initial registration process. If you have been able to successfully register for an account, then you should not have any connection problem… Were you able to register?

  65. Avatar of vbspeakingvbspeaking says:

    Henry, whats the best time frame to use the meter with?

    • Avatar of Henry LiuHenry Liu says:

      I use it mainly to determine the direction of the markets for the day, as the meter resets daily. So I wouldn’t recommend to use it on a fixed timeframe, but instead use it to confirm your entries.

  66. Avatar of FemiFemi says:

    I could not find the download link for this Henry

  67. Avatar of martin77martin77 says:

    i wish i had found you and your currency meter months ago Henry . It really is such an asset and I find your CNT website most helpful and informative in the field of trading the news . Many thanks.

  68. Avatar of pmipmi says:

    Hi Henry
    Why are the Sydney and Tokyo session lights always on and the London and New york never light

  69. Henry,

    Really enjoy the news feature with alerts on the CSM. One question. I see how to pin the meter itself so that it’s always on top. But I noticed when the news result alerts popup they stay in the background, so that if you have your browser open for example, you don’t see them. Anyway to get them on top???

    Thanks,
    Bret

  70. Hi Liu,

    1)How to identify the reversal using your strength (in advance)?

    2) what time frame of this CSM is calculating?
    3) If I am trading biary option,how to determine minimum best expiry time?

    4)How to know trending and reversal ?
    5) how to know if it is over strength/over falling and about to soar again?

    please let me know answer to above to use CSM in a full strength.

    • Avatar of Henry LiuHenry Liu says:

      Hello, welcome to CNT. Here are some answers to your questions. 1) The CSM is not really meant to identify REVERSALS, it is meant to identify strength and weakness. 2) This indicator calculates the trading day, which is different than the daily timeframe. It looks at the open/close for the day starting from GMT+2. 3) I have no idea how this would work with Binary Options. 4) Once again, this tool is not meant to determine trend or reversal. 5) Once again, this indicator does not determine strength/over falling and about soar again.

  71. Avatar of bazbrooksbazbrooks says:

    Henry i ‘m some how unable to login to new csmeter at point of registration it says when i sign in i have a problem with connection is their a way to fix this?

  72. Avatar of kathykathy says:

    i like your indicator. could it be developed for an android phone?

  73. Avatar of kennethkenneth says:

    @henry
    Hi,
    the csm downloaded is not updating any news on the metal trade platform. i hope am not using the old version of the csm because is showing me no news update till next week. please what should do

    • Avatar of Henry LiuHenry Liu says:

      Hmm CSM does not need MT4. CNT EA does. If you have issues with CNT EA, then you need to make sure that you’ve followed ALL steps in the installation instructions. That means you need to register for CNT member, enter the user/pass in the appropriate field of the EA. Also you need to enter Suffix if your broker uses suffix. If you still have problems, then let us know.

  74. Hi Henry, I have downloaded the csm on my Metatrader4.
    How come the value of the indicator is different from the data shown on this page??
    On the page EUR 8.00 JPY 3.20
    On indicator EUR 2.00 JPY 6.70

  75. where to download option of Currency Strength Meter?

  76. henry, my csm 3.0.6 has stopped working about 15 minutes ago

  77. Avatar of festusfestus says:

    hello mr liu,the guru,pls sir the new CURRENCY STRENGHT METER i download refuse opening.when i wanted to register my account.telling me (problem with loading) pls sir what do i do to rectify this problem

  78. Avatar of tlp87tlp87 says:

    Thank you so much Henry!!

  79. Avatar of walabywalaby says:

    thank you for this .

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