How can I use this tool?
The uses are numerous, the trading benefits are countless
The FX Indices provide an aggregate macroeconomic view over
the direction a single currency is trading
Trading applications include:
> Gauging market sentiment
> Testing macroeconomic themes
> Assessing correlation strength
> Identifying correlation decoupling that represent tactical trading opportunities
to buy or sell a temporarily over - or undervalued currency pair
The VARIANSE Currency Indices and Baskets can become a valuable tool in your trading arsenal, allowing you to make informed trading decisions, forming the basis of a multitude of trade ideas, trading systems and strategies.
For instance, if you seek to take a long term bearish view on The Euro, seeing a prevailing downtrend in the EUR Trade Weighted Index may confirm your conviction to go short EURUSD.
As the chart would indicate that against a basket of major currencies, the Euro has been sold off.
This may provide you with the conviction to take your short position and help you to identify your target entry and exit points for the trade.
Trade Smart. Your capital is at risk.
