General – getting started
If there is one currency you need to follow, whether as a forex trader, or a trader in other markets, it is the US dollar. The US currency is the currency of first reserve, and the axis on which all the financial markets spin. The dollar supports the largest debt market in the world, it is the currency in which all commodities are priced, it is the principle currency held by all major banks, and is the currency used in facilitating exotic currency transactions. As the currency of first reserve, it also reflects risk sentiment.
The DXY indicator has been developed to allow you to instantly see US dollar strength and weakness without leaving your MT4 platform. It can be applied beneath a currency pair, or on a separate chart. The choice is yours. The DXY is based on the original dollar index, but we have replaced the SEK (Swedish Krona) with the Australian Dollar (AUD), as the SEK is rarely available on the MT4 platform. The weightings are as follows:
- EUR 57.6%
- JPY 13.6%
- GBP 11.9%
- CAD 9.1%
- AUD 4.2%
- CHF 3.6%
The Quantum DXY indicator displays strength and weakness in the US dollar against this basket of currencies. It will give you an instant view of the US dollar. Alternatively, why not create a separate workspace with multiple timeframes.
The indicator can be used in one of three ways:
- First, as an inverse indicator to a major currency pair, helping you get in, stay in and get out
- Second, as a confirming indicator for the Quantum Currency Strength indicator, providing a perspective against other currencies
- Finally, as the ultimate barometer of risk
Whichever approach you adopt, you will no longer have to leave your MT4 platform for a view of the US dollar! In addition, the indicator is also supplied with two moving averages already applied, the 8 SMA and the 14 SMA to help provide you with further insights into market direction.
- The Quantum DXY indicator works in all timeframes
Installation
Open your MT4 platform and in the top level navigation:
- Left click >View
This will open the following window:
- Left click > Navigator
This will open the following window:
- Left click > + icon alongside Custom Indicators
This will open the following window:
- Left click and HOLD – drag the QuantumDXY indicator to a chart, and RELEASE
This will then display the following window. This is where you can configure all the various user settings for your DXY indicator. To move from one tab to another simply left click on the grey tab to select the appropriate window.
Common Tab
The Common tab displays two boxes. Both of these should be checked as shown. This ensures that you have enabled the DLL imports as explained in the installation instructions.
Inputs Tab
There are several variables than can be changed, and these are as follows:
Look back
This is the number of bars the indicator processes. It determines the number of bars the indicator generates for the index. It is set to 200 bars by default.
MA1 Period
This is the first Simple Moving Average with a default setting of 14. The Value can be changed as follows:
- Double left click alongside this Variable in the Value field
- The Value field will change to white – enter a number such as 26 to change to a slower period
MA2 Period
This is the second Simple Moving Average with a default setting of 8. The Value can be changed as follows:
- Double left click alongside this Variable in the Value field
- The Value field will change to white – enter a number such as 5 to change to a faster or slower period
Line chart mode
If this setting is set to true, the indicator becomes a line chart as opposed to its default mode which is a candlestick chart.
Line chart price type
If the indicator is set to line chart mode (Line chart mode = true), this setting determines which price type is used in its calculation. It can be one of the following:
- OPEN_PRICE
- HIGH_PRICE
- LOW_PRICE
- CLOSE_PRICE
Color inputs
- Bullish candle color
- Bearish candle color
You can customize the color of the candlesticks by changing these settings.
To change the color:
- Double left click in the Value field
- Select the color from the drop down menu by clicking on the drop down arrow to display the menu of colors
- Left click OK to confirm
This will then activate the color for the candlestick.
Currency Prefix
This is the variable field that you will need to update, if your FX broker delivers your currency pairs with a prefix. As an example this might be a.EUR/USD, in which case you would need to enter the value a. in the currencyPrefix field. If your currency pairs are delivered with a prefix, then you MUST enter this in this field, otherwise your indicator will not work.
To change the setting:
- Double left click in the Value field, and the field will turn white with your cursor flashing. Enter a new value
- Click return to save any changes
Currency Suffix
This is the variable field that you will need to update, if your FX broker delivers your currency pairs with a suffix. As an example this might be EUR/USDm, in which case you would need to enter the value m in the currencySuffix field. If your currency pairs are delivered with a suffix, then you MUST enter this in this field, otherwise your indicator will not work.
To change the setting:
- Double left click in the Value field, and the field will turn white with your cursor flashing. Enter a new value
- Click return to save any changes
Colors Tab
The default colors and settings are as follows:
- Index line (in Line chart mode) – Turquoise- Width 3 (the Style is fixed)
- SMA 1- DodgerBlue – Width 1. – Style 1. Long dash
- SMA 2- Magenta – Width 1. – Style 3. Long/short dash
Please disregard the first two color inputs. (0 and 1)
To change the color:
- Double left click alongside the item you wish to change in the Color field
- Left click on the drop down arrow and a color menu will appear
- Select your preferred color which will then appear as your selection
To change the width:
- Double left click alongside the item you wish to change in the Width field
- Left click on the drop down arrow and then select your preferred width of line from the drop down menu (1 is the narrowest, 5 is the widest) – this will then change the thickness of the line
To change the style:
- Double left click alongside the one you wish to change in the Style field
- Left click on the drop down arrow and a menu will appear with the various styles
- Select your preferred style
Levels Tab
There are no user inputs for the indicator.
Visualization Tab
These are the default settings for MT4. There are no user inputs for the indicator.
When you are happy with all your changes…
- Left click the OK button at the bottom of the window, and your QuantumDXY indicator will be applied to your chart
At this point your DXY indicator will look something like this:
Finally, to remove the indicator from your chart:
- Right click on the chart and the following pop up window will appear:
- Left click on Indicators List from the above menu and the following menu will appear:
- Left click the indicator, and then left click the Delete button on the right
