Learn Forex Trading System Course for Discretionary Traders

Understanding the correlation between pairs can help us to maximise profits or manage portfolio risk by hedging.

Here I have chosen 2 tables showing the following currencies:

• USD
• EUR
• AUD
• JPY

According to the publisher of the tables www.mataf.net,

The correlation coefficient highlights the similarity of the movements between two parities.

• If the correlation is high (above 80) and positive then the currencies move in the same way.
• If the correlation is high (above 80) and negative then the currencies move in the opposite way.
• If the correlation is low (below 60) then the currencies don’t move in the same way.