A currency strength meter is a technical indicator that determines the relative strength of currencies by analyzing multiple currency pairs and evaluating the strength of each currency within those pairs. It uses a formula or algorithm that considers factors such as price movements, market trends, and other relevant data to produce an aggregate, comparable strength of each currency. The resulting data is then presented in an easy-to-understand format, allowing traders to identify which currencies are currently stronger or weaker.

A currency strength meter typically displays the strength of each currency on a scale, using colors or numerical values to represent their relative strength or weakness. A strong currency might be shown in green with a high positive score, while a weak currency might be displayed in red with a negative score. Currency strength meters often divide the strength of a currency into different categories to provide traders with a clearer understanding of the current market dynamics. These categories typically include strong (green), neutral (yellow), and weak (red) .

A currency with a positive score is considered strong, indicating that it is performing well against other currencies, while a currency with a negative score is considered weak. Traders can use currency strength meters to identify opportunities to pair strong currencies against weak ones. For instance, they may consider buying a currency that is currently strong and selling a currency that is weak to enter a trade.

Currency strength meters can be beneficial for various trading styles, including day trading, swing trading, and position trading. However, they may be more advantageous for medium to long-term traders who focus on trends. It is important to note that a currency strength meter doesnt tell traders when to enter a trade, but it only helps them to filter for potential currency pairs to trade[[5]](https://www.tradingview.com/script/I1mIzpqC...