The closer the Correlation Coefficient is to 1, the higher their positive correlation. The instruments will move up and down together. The higher the Correlation efficient is to -1, the more they move in opposite directions.
A value at 0 indicates that there is no correlation. Interestingly there have been considerable falls in the correlation coefficient in and Are we in a new era where global markets are detached? Tracing the Elliott Wave Counting from the time of downtrend.
How many of you will agree on this? Seems like the ABC is coming to town after this big drop. As for me, I'll definitely ride this trend. Another example where you can trade simultaneously two negatively correlated pairs. This is because their economies share much in common, among other things. Not all time frames are correlated the same. The first thing you'll notice with the Forex correlation table, is that you have a guide that explains correlation strength.
Become familiar with this guide and reference it often if you must. It offers a quick way to measure if two pairs are correlated or not.
The second most important step when using the Forex correlation table is selecting your currency pairs. This is where you'll choose the pairs you want to show up in the correlation table. This is where you can enter a custom correlation period. The default is 50 periods, which is what I use.
If you do decide to increase or decrease this number, just know that it could adversely effect the reliability of the correlation. I've found 50 periods to be most accurate for the way I trade. The Results After you click Submit, scroll down to see the results. Here's an image of the daily correlation at the time of this writing. A positive number means the currency pairs are positively correlated, while a negative number means they're negatively correlated.
I hope it's as useful for you as it has been and continues to be for me. To clear the air, I have no affiliation with the developer of this tool, ForexTicket. It really depends on where I am in the trade. If I entered middle of the week and the trade setup is starting to fall apart by Friday, then I might close before the weekend. Yes, the same holds true. I will bookmark this table from now on. Please log in again.