Community Forex Questions
What causes currency pair movement?
A currency pair's correlation refers to the similarities that various pairings have. In the forex market, no currency pair trades completely independently of the others. Understanding forex correlation pairs is useful when managing a portfolio. When trading the euro against the Japanese yen (EUR/JPY pair), a trader is effectively trading a derivative of the euro dollar (EUR/USD) and dollar-yen (USD/JPY) pairings. As a result, the EUR/JPY pair must have some link with one or both of these other currency pairings.
A currency pair's correlation refers to the similarities that various pairings have. In the forex market, no currency pair trades completely independently of the others. Understanding forex correlation pairs is useful when managing a portfolio. When trading the euro against the Japanese yen (EUR/JPY pair), a trader is effectively trading a derivative of the euro dollar (EUR/USD) and dollar-yen (USD/JPY) pairings. As a result, the EUR/JPY pair must have some link with one or both of these other currency pairings.
When choosing your Forex trading currencies, keep correlated pairs in mind, especially those involving the dollar. For example, if you traded EUR/USD and USD/CHF, your risk may be doubled. If the cost for one pair is not in your budget, it is also not in your budget for the second pair.
When choosing your Forex trading currencies, keep correlated pairs in mind, especially those involving the dollar. For example, if you traded EUR/USD and USD/CHF, your risk may be doubled. If the cost for one pair is not in your budget, it is also not in your budget for the second pair.
A currency pair's correlation refers to the similarities that various pairings have. In the forex market, no currency pair trades completely independently of the others. Understanding forex correlation pairs is useful when managing a portfolio. When trading the euro against the Japanese yen (EUR/JPY pair), a trader is effectively trading a derivative of the euro dollar (EUR/USD) and dollar-yen (USD/JPY) pairings. As a result, the EUR/JPY pair must have some link with one or both of these other currency pairings.
When choosing your Forex trading currencies, keep correlated pairs in mind, especially those involving the dollar. For example, if you traded EUR/USD and USD/CHF, your risk may be doubled. If the cost for one pair is not in your budget, it is also not in your budget for the second pair.
When choosing your Forex trading currencies, keep correlated pairs in mind, especially those involving the dollar. For example, if you traded EUR/USD and USD/CHF, your risk may be doubled. If the cost for one pair is not in your budget, it is also not in your budget for the second pair.
Jun 21, 2022 10:57