Profiling the application I figured out that there are a lot of strings on heap.
In my situation, strings are created on heap and not interned and they are not literals
Related to -XX:+UseCompressedStrings, you should have a look at this question: Support for Compressed Strings being Dropped in HotSpot JVM?
And, related to -XX+UseStringCache, have a look at : JVM -XX:+StringCache argument?
Btw. Java 7 comes with nice features that allow tuning of String cache when using the interned Strings. See -XX:+PrintSTringTableStatistics and -XX:StringTableSize=n. This way you can optimize the String cache size.