The USDx indicator for MetaTrader4 is a technical tool that is used to measure the US dollar (USD) against a basket of other world currencies.
The USDx is an important analytic tool for traders in just about any market, although it was a futures contract, which implies that it could be traded just like gold, oil, or corn contracts for anyone with a futures trading account.
Nonetheless, instead of trading the USDx, most retail traders employ this tool to evaluate the comparative strength or weakness of the greenback as a whole.
The currencies that are included in this basket are the Yen, Swiss franc, Canadian dollar, Swedish krona, British pound and obviously the euro. Each of the currencies listed are given a weight with euro having the largest.
The USDx often resembles the chart of the USD/EUR futures contract, owing to the fact that the euro is classically half the entire weight included in the average.
The USDx is a better gauge of the strength of the U.S. dollar than any single currency pair, say EUR/USD, considering the fact that it contains six different currencies.
The USDx was established in 1973, with a starting value of 100. If the USDx measure below 100, the USD is said to have lost relative value as against its worth in 1973, and if it stands above 100, then the USD is said to be stronger than its relative worth in 1973. At the moment, the USDx is dancing around the 95, which means it is 5% weaker than its starting value.
MT4 Indicator Characteristics
Currency pairs: Any
Platform: Metatrader 4
Type: chart window indicator
Customization options: Variable (MA), Colors, width & Style.
Time frames: 5-Minutes, 15-Minutes, 30-Minutes, 1-Hour, 4-Hours, 1-Day, 1-Week, 1-Month
Type: pattern, trend