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Currency pair temperature is a number that describes the level of agitation in price quotes in a familiar Fahrenheit, Celsius, and Kelvin scale. Agitation means: random movement of the price quotes, which may also be described as "volatility". The temperature calculation is designed so that systematic movements don't contribute to the temperature reading. A systematic movement is when the market is "trending". For trading purposes, lower temperature readings are desirable. A low temperature reading indicates that there is less volatility. If an investor decides to invest during a hot market, the investor should be prepared to allocate more funds towards reserves.
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