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Power of USD VertexFX Indicator

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1Power of USD VertexFX Indicator Empty Power of USD VertexFX Indicator Fri Oct 23, 2020 7:27 am


Power of USD is a VertexFX indicator that calculates 

the strength of the US Dollar (USD) with respect to 

major USD forex pairs. It should be traded on USD 

based pairs, namely - AUDUSD, EURUSD, GBPUSD, 


The US Dollar accounts for nearly 80% of the world’s 

currency transactions and therefore forex traders 

rely on trends in various USD-based forex pairs to 

gain insights into the strength of the US Dollar. 

The PowerOfUSD indicator calculates the equal-

weighted strength of USD from the seven major USD 

pairs. The formula of  Power of USD is listed below:

PowerUSD = (USDCAD + USDCHF + USDJPY / 100.0 – 


Currencies that are denominated in USD are 

subtracted from currencies where USD is the base 

currency. When the USD exhibits strength, the Power 

of USD indicator falls, whereas when the USD 

exhibits weakness it rises. It should be noted that 

the value of USDJPY is divided by 100 to adjust for 

the base value of Yen.

When USD becomes strong, the value of AUDUSD, 

EURUSD, GBPUSD, and NZDUSD fall – because a lesser 

quantity of USD can be purchased with these 

currencies. At the same time, the value of USDCAD, 

USDCHF, and USDJPY rises because more quantities of 

CAD, CHF, and JPY can be purchased respectively 

using USD. When the net effect result, which is the 

Power of USD indicator value is falling, it implies 

a strong and confirmed rise in the USD.

This indicator should be used only on USD based 


USDCHF, USDCAD, and USDJPY. Signals generated for 

USD denominated pairs, namely AUDUSD, EURUSD, 

GBPUSD, and NZDUSD should be reversed for non-USD 

denominated pairs, namely, USDCAD, USDCHF, and 


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