Daily Archives: July 29, 2015

New PotenzaFX Based Trading System: Overview (Part 1) 2

Hi everyone,

Yesterday we send everyone an email anticipating the performances of a new trading system based on our PotenzaFX indicator set.


Today I want to start describing it.

For those of you that still don’t know how PotenzaFX works I suggest you to give a read to the dedicated page here:

and for more details to the 101 section dedicated to it:

In short, PotenzaFX calculates the strength and weakness of each single currency (for the major 8 currencies) based on how they are performing versus the other 7.

So it give us a score usually between -100 (very weak) and +100 (very strong). The score range depends on the algorithm utilized in our PotenzaFX. We can choose between many of them.

So far we traded PotenzaFX by looking at the crosses between the currencies scores. For example, if the EUR curve goes above the USD it means that we have to buy EURUSD as EUR is becoming stronger than USD. And vice versa, if USD crosses the EUR curve, we should sell EURUSD as USD is becoming stronger than EUR.

But there can be another approach to trading with it and it’s what I’ve been trading to have the above performances.

The idea is simple but it’s a little tricky to trade and that’s why I’ll divide the strategy description in 2 or 3 posts.

We now look for “overbought/oversold” areas.

If a currency reaches goes above a specific level and then comes back from it, then it is time to SELL that currency versus all the other 7. Vice versa if the currency goes below a specific level and then comes up above it, then it’s time to BUY it against all the other 7.

This is the general rule but we can add “filters” to it, mainly to the currencies we take into account to open a trade with. I’ll be more specific in the next post about it.


In the above example picture we had two signal yesterday: sell NZD (red line) and also sell CAD (purple line). The day before to sell EUR (green line), buy GBP (yellow line) and buy CHF (blue line).

Let’s say that EUR goes above our trigger level and then it comes back. It means that we have to sell EUR vs the other currencies. And so we sell: EURAUD, EURCAD, EURCHF, EURGBP, EURJPY, EURNZD and EURUSD.

When do we close?

When the curve of the EUR crosses the one of the other currency. So in our example, when EUR crosses (goes below) the cure of the AUD we close the short EURAUD. When EUR goes below the USD, we close the EURUSD and so on. In our previous approach we use to open a trade here and not close 😉

That’s the strategy in brief.

It’s quite simple but requires attention as it may lead to opening a good amount of positions that’s why you may decide to limit the number of currencies you want to open orders with.

I want to remember you that you can still get the PotenzaFX indicator set as well as ANY of our indicators and EAs with up to a 50% discount, thanks to our Summer Sales coupons:

50% Discount Coupon (only 12 left!)

40% Discount Coupon (only for the first 20)

30% Discount Coupon (only for the first 25)

You better hurry before they are all gone.

Have a great profitable summer!