Volume weighted Forex Overwiew True Strenght Index

Adding volume weighting to the FOTSI strategy improves its effectiveness by making the indicator more sensitive to periods of high market activity. Here’s how:

• Market Relevance: Futures volume reflects institutional and large trader participation. When volume is high, price moves are more likely to be meaningful and less likely to be noise.
  
• Dynamic Weighting: By multiplying each currency’s momentum by its normalized futures volume, the indicator gives more weight to currencies that are actively traded at that moment, making signals more robust.
  
• Filtering Out Noise: Low-volume periods are down-weighted, reducing the impact of illiquid or less relevant price changes.
  
• Better Timing: Signals generated during high-volume periods are more likely to coincide with real market moves, improving entry and exit timing.