How the correlation between currency pairs works
The correlation between currency pairs is a very interesting topic for investors in the currency market.
Correlation between currency pairs indicates how similarly two currency pairs move in the market.
There are different types of correlation, such as positive, negative and neutral correlation .
For example, the EUR/USD and GBP/USD currency pairs are often positively correlated, meaning they tend to move in the market in a similar way.
On the other hand, the EUR/USD currency pair and the USD/CHF pair are often negatively correlated, which means that when one pair goes up, the other tends to go down.
Pairs generally moving in the same direction
- EUR/USD and GBP/USD.
- EUR/USD and AUD/USD.
- EUR/USD and NZD/USD.
- USD/CHF and USD/JPY.
- AUD/USD and NZD/USD.
Pairs that generally move in opposite directions
- EUR/USD and USD/CHF.
- GBP/USD and USD/JPY.
- USD/CAD and AUD/USD.
- USD/JPY and AUD/USD.
- GBP/USD and USD/CHF.
