How to use Logikfx LITA Technology
Updated: May 8, 2021
Welcome to a brief guide on how to navigate and use Logikfx's LITA Technology.
In this article, you will learn about the functionality and guidelines of using the following trading technology available in the LITA Portal:
Where to find the LITA Technology
How the Technology Fits into a Forex Strategy
LITA Tech Summary
Forex Opportunity Rankings
Macro Currency Strength Meter
Interest Rate Forex Indicator
GDP Forex Indicator
Commitments of Trader Analysis (COTA)
Learn the best ways to use the tech
The tools are updated every Saturday by 12pm GMT.
These tools are primarily used by forex traders to save time on their fundamental analysis, and build out high-quality trade ideas each week.
The tools and technology themselves can be implemented within whatever strategy you're using.
Read more about how we use the technology on our ideas.
If you're currently using a technical strategy and you're missing out on that fundamental analysis then this is what you want to start adding as confluence.
We'll be answering some common questions in this post and also giving you all a step by step guide one what each piece of technology does and mean when you're using it.
Where to find LITA technology
Step 1:
Step 2:
View all the technology you want to access on the left hand menu.
This ranges from value tools to optimisation tools.
The value tools help traders identify the fundamental "value" of a currency pair.
Whereas, the optimisation tool helps you determine market sentiment and timing.
Step 3:
Select the technology you want to use and it will open in a new browser!
The good thing about LITA technology is that it's all browser based, no dodgy downloads and accessible anytime!
How the Technology Fits into a Forex Strategy
Below is the global macro framework that majority of Logikfx traders follow, and save time by using the LITA Technology:
This is an example of how the technology fits into a complete forex strategy, but is not the only way it can be used.
For more information on this approach to trading, you can learn more here.
To learn other ways existing logikfx subscribers use the technology to help with their forex trading, check out the forum here.
LITA Tech Summary
The LITA Tech Summary allows traders to get an overall fundamental view of the currency pair they choose.
Here you can view the top opportunities available based on the fundamentals of the markets.
Then by selecting a base and quote currency you can get a detailed summary of the pair.
Underneath you have the main dashboard, you can select the Macro scores which give a quick insight into the macro currency strength meter of that pair.
The GDP Diff % allows you to view the relative GDP growth rates of two countries.
The IR Diff is the interest rate differentials indicator showing the hot money flows and overall bullish or bearish economic signs based on interest rates.
Then finally COTA Diff which is the overall market sentiment based on hedge fund positions.
Forex Opportunity Rankings
The Forex Opportunity Rankings is a table of some of the best forex opportunities in the markets based on our fundamental indicators.
The rankings start from top to bottom, the top having the strongest weighting and the bottom the lowest.
The large circled arrows suggest the strength or weakness whereas the smaller circles show the change from previous data.
E.g. a smaller red arrow suggests it fell from previous and green smaller circle shows data has grown since then.
You can then click the row for a pop out version of the LITA Tech Summary of that currency pair.
This tool basically allows the traders to focus on the best upcoming pairs to put on the watchlist.
They may not be ready yet based on your own strategy or the global macro strategy.
However, based on our fundamental indicators these are what we find to be the best ones.
Macro Currency Strength Meter
Our currency strength meter is a tool that shows you how strong, or how weak a currency is, or could be in the future.
It's commonly used by Forex Traders as "Forex Strength Meter".
What sets this apart from the free currency strength indicators is that ours crawls through thousands of economic reports from 23 different economies using a clever algorithm.
It analyses these economic reports and determines a currency strength based on future economic growth or contraction expectations.
Making fundamental analysis accessible to all traders, not just the big boys.
What you do is select a base currency (economy) and quote currency (counter economy). This will then grab the data from those two countries and compare it.
The line graph shows the trajectory of economic data and underlying insights you won't see elsewhere.
When the line is above zero and growing it's expansionary for the base currency and you could determine the currency "strong" whereas if it's below zero and falling you can assume it's contracting and "weak".
There are many ways to use the currency strength meter at your own discretion, try it yourself free for a week.
GDP Differential Meter
The GDP Differential Meter is one of our tools that analyses the health of an economy against another.
When you select a base currency and a quote currency you analyse the GDP growth rates between the two countries respectively.
This creates a net GDP growth differential which quickly tells us in comparison who's growing faster.
If the change in differential from the previous year is positive, this generally indicates the money flow will be towards the base currency, and vice versa.
The red arrow in the top right means there are bearish signs in GDP differentials.
IR% Differential Meter
The Net Interest Rate Differential (NIRD), in the international currency (forex) markets, is the total difference in the interest rates of two distinct national economies.
Generally, it's considered investors will hold currencies that pay the highest interest.
Therefore, it's a useful tool for a lot of forex traders and investors in general.
Export Analysis Meter
This is an upcoming technology to show the main exports of a country which allows us traders to conduct the import/export analysis and see which main commodities/ companies affect the exchange rate the most.
Keep an eye out for it...
Commitment of Traders Analysis (COTA)
The above analysis is a comparison between the hedge fund sentiment of two currencies, calculated by long (%) minus short (%) open interest .
The differential represents the difference between hedge fund sentiment of the base currency and quote currency. If the differential between the base currency and quote currency is positive, this is considered a sensible time to enter long on the currency pair, and vice versa (provided thorough macro analysis also agrees).
When the differential is below zero, you can expect the overall market sentiment to be bearish and when it's above zero you can expect a bullish sentiment.
It is however important to note the individual open interest of each currency as ideally you want the base currency to be positive and quote negative open interest for long positions and vice versa for shorts.
Sourced from U.S. Commodity Futures Trading Commission (CFTC)
Learn the best ways to use LITA Technology
For a complete structure on the best ways to get the most out of LITA Technology, checkout the free class here.
Learn to trade with Logikfx Academy
Take the first steps into growing your value as a trader with our free online courses, webinars, seminars. All from a small team of highly skilled traders with over 15 years’ experience in the financial markets.
Learn how to use powerful tools such as the macro currency strength meter alongside market positioning through a step-by-step COT tutorial - all at your own pace, including interactive exercises, engaging examples, and full support to help you develop your understanding.
Forex Quick Analysis Guides
When analysing sentiment it's always useful within your trading strategy to analyse the COT report properly. Before this however, making sure you have a fundamental direction using the macro currency strength meter is one of our unique edges in the markets.
These are all crucial steps on how to make money trading forex.
Finally, making sure you can manage your trades using the right trading journal which includes how to set your stop losses and profit targets correctly.
