# Currency Strength Currency Strength is an indicator on [Vela](https://vela.luxalgo.com/chart), our next-generation charting platform, written in Pine Script®. Tracks the relative strength of five user-selected currencies by averaging each one's normalized close-to-open change across its four pairings in the basket and accumulating that average, with readings that reset each period. A configurable strength meter ranks the currencies while an optional scatter plot separates strength from momentum in four color-coded quadrants. - Indicator in the LuxAlgo Library, by LuxAlgo, published Feb 7, 2023. - Access: free. - Concepts: [Currency Strength Meter](https://www.luxalgo.com/library/concept/currency-strength-meter/) (primary) - Open on Vela: https://vela.luxalgo.com/chart?pineScriptCodeId=cmpwn142n001gvhsgxljfdpva - Page: https://www.luxalgo.com/library/indicator/currency-strength/ The **Currency Strength** indicator scores five user-selected currencies against one another and plots how those scores evolve across a chosen period. It's LuxAlgo's build of the [currency strength meter](https://www.luxalgo.com/library/concept/currency-strength-meter/): each currency's close-to-open change is normalized to a percentage, averaged across the currency's four pairings in the basket into a composite score, and accumulated until the period resets, so "strength" means measured relative performance, nothing vaguer. ## How to Trade the Currency Strength? - **Ranking read**: currencies topping the meter are outperforming the basket over the window; those at the bottom are lagging, the raw material for choosing which pairs deserve attention. - **Trailing strength lines**: the historical plot shows each currency's accumulated relative performance, resetting at period end so readings stay comparable across cycles. - **Scatter quadrants**: each currency's current strength (vertical) is plotted against its change from the previous period's final reading (horizontal, scaled across the basket). Strong (green, upper right) is positive strength with a larger change; Improving (aqua, upper left) is positive strength with a smaller change; Weakening (yellow, lower right) is negative strength with a larger change; Weak (red, lower left) is negative strength with a smaller change. - **Meter resolution**: raise it to expose finer differences between closely matched currencies. The scatter view is the distinctive piece: by plotting current strength against the previous period's, it separates level from momentum: a currency that is strong-but-fading reads very differently from one that is weak-but-turning. ## What the Currency Strength Shows - The trailing relative strength of the five selected currencies over a user-defined timeframe period, or a scatter plot as an alternative display. - A strength meter whose visibility, resolution, position, and size are configurable. - A scatter graph whose horizontal width in bars is set by Scatter Graph Resolution; the vertical extent follows the strength values. - Under the hood, each pairing's reading is the normalized close-to-open change, (close − open) / open × 100, composited per currency across the basket. ## Frequently Asked Questions ### What does "strength" mean here? Performance, precisely: the normalized close-to-open change averaged across the currency's four pairings in the basket and accumulated over the selected period. A stronger currency has simply performed better within that window. ### How do I turn readings into trade ideas? Strength ranking narrows the field to outperformers and laggards; from there, verify relationships before committing. [Correlation Clusters](https://www.luxalgo.com/library/indicator/correlation-clusters/) groups instruments by how they actually move together, a useful cross-check against doubling up on the same exposure. ### Is the Currency Strength indicator free? Yes. It costs nothing on the LuxAlgo Library. The page can also hand it to Quant, our coding agent, for hands-on testing whenever you like. You can also copy the source code from this page and run it anywhere Pine Script® runs. ## Related indicators - [Relative Performance Areas](https://www.luxalgo.com/library/indicator/relative-performance-areas/) (Relative Strength Comparative): markdown at https://www.luxalgo.com/library/indicator/relative-performance-areas.md - [Stablecoin Dominance](https://www.luxalgo.com/library/indicator/stablecoin-dominance/) (Ratio Charts): markdown at https://www.luxalgo.com/library/indicator/stablecoin-dominance.md - [Relative Strength Scatter Plot](https://www.luxalgo.com/library/indicator/relative-strength-scatter-plot/) (Relative Strength Comparative): markdown at https://www.luxalgo.com/library/indicator/relative-strength-scatter-plot.md - [Relative Crypto Dominance Polar Chart](https://www.luxalgo.com/library/indicator/relative-crypto-dominance-polar-chart/) (Relative Strength Comparative): markdown at https://www.luxalgo.com/library/indicator/relative-crypto-dominance-polar-chart.md - [Volume Bubbles & Liquidity Heatmap](https://www.luxalgo.com/library/indicator/volume-bubbles-liquidity-heatmap/) (Breadth, Sentiment & External Data): markdown at https://www.luxalgo.com/library/indicator/volume-bubbles-liquidity-heatmap.md - [Crypto Liquidation Heatmap](https://www.luxalgo.com/library/indicator/crypto-liquidation-heatmap/) (Breadth, Sentiment & External Data): markdown at https://www.luxalgo.com/library/indicator/crypto-liquidation-heatmap.md - [Liquidation Levels](https://www.luxalgo.com/library/indicator/liquidation-levels/) (Breadth, Sentiment & External Data): markdown at https://www.luxalgo.com/library/indicator/liquidation-levels.md - [Market Breadth Toolkit](https://www.luxalgo.com/library/indicator/market-breadth-toolkit/) (Breadth, Sentiment & External Data): markdown at https://www.luxalgo.com/library/indicator/market-breadth-toolkit.md --- Source: https://www.luxalgo.com/library/indicator/currency-strength/ (LuxAlgo Library). Free to use with attribution: https://www.luxalgo.com/library/license/