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Currency Basket vs USD - Trend & RSI Breakdown

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๐Ÿ“Š Indicator Methodology

Currency Basket vs USD โ€“ Trend & Valuation Breakdown
๐Ÿ’ฑ Strategy of Rotating Between USD and the Currency Basket
๐Ÿ’ฐ 100% cash strategy โ€“ always ready for market crashes.

๐ŸŸข Hold USD if the trend indicator shows USD is trending.

๐Ÿ”ต Hold the currency basket (EUR, PLN, CZK, CHF, GBP) if the basket is trending.

โœ… This way, you're always on the winning side of the trade, never risking a loss of purchasing power.
๐Ÿ“ˆ Since it's a LONG ONLY, NO LEVERAGE strategy, there are no trading or holding fees, except for a small 0.15% FX fee every few months when the trending currency changes.

๐Ÿ“ˆ Trend Indicator
Uses 5 different indicators working together to determine which asset is in a trend.

๐Ÿ‘€ On the chart it's visualized as:
โž• Plus symbols indicating trend strength (usually ranges from -4 to +4).

๐Ÿ”บ If USD has a higher trend signal than the basket โ†’ Hold USD.

๐Ÿ”ป If the basket has a higher signal โ†’ Hold the basket.

๐Ÿ•’ Signals typically last several months and operate on the 3D (3-day) timeframe, giving a high probability of catching macro moves.

๐Ÿ’ก Valuation Indicator (Z-scored RSI)
Uses RSI with a length of 30.

Z-scored between -1 to 1.

๐Ÿ“‰ Interpretation:

-1 for USD = too strong โ†’ likely stagnation or reversal.

-1 for Basket = undervalued โ†’ likely growth or stabilization.

๐Ÿ“Š Displayed as a separate line below the main chart.
๐Ÿ“ A horizontal line at 90 is added on the main chart โ€“ helping you quickly see whatโ€™s above or below this key reference level.

โš™๏ธ How the Strategy Works in Practice
โœ… You update the indicator daily (takes only seconds).
โœ… The trend indicator tells you which currency to hold.
โœ… The valuation indicator prepares you for possible reversals.
๐Ÿ”„ When the trend shifts, you rotate your full position.
โณ Trades typically last several months.
๐Ÿ“ˆ Usually generates consistent profits of 2โ€“8%.
๐Ÿ’ช It grows your capital while keeping you ready to buy assets during major selloffs.

๐Ÿ” Best Usage
Use it as a quick scanner to observe trend or valuation changes.
If a signal appears, validate it using additional trend and valuation indicators.
๐Ÿ“Œ If most agree, take the position.



Penafian

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