Forex Tips : Correlation Currency Pair

Correlation Currency Pair does not necessarily shows you the direction. If the first currency pair moves first, and the 90% correlation pair that we all assume would be following next. But there is a 50% that the first currency pair will come back to the original place where it just start off within an hour. Well it's true that it makes back the 90% correlation.


However, you are still safe with the 90% correlation pairs because it does not make such a drastic move.

So where do we use it?
 

 

 


 

 

 

a) To show you confusions? and same directions? same directions would go off for a long period of time.
 

    



b) To show you the similar candlestick drawing between 2 currency pairs. This is where you could learn candlesticks pattern.
 

   


Does candlestick have any weakness? It's a 'yeah'. However, learning candlestick is not a skill of matching every single candlestick, as it's a general view of candlestick to be viewed as a group. If you are matching every single candlestick, when you are in the trade, you are going to match every single candlestick every minute and use stop loss to hit.

 

Therefore, NZD and AUD let's you check the similarity of candlestick as well as let you view  what type of candlestick that makes you see the chart clearer even both of them is similar.