Get started

Correlation

BTC | Correlation doesn't assume causationIt sure doesn't. But in BTC's case, it seems as though the two go hand in hand. And despite the rhetoric of BTC being a hedge against risk on assets, since 2011, BTC has a correlation coefficient of about r=0.78 compared to that with gold of about r= -0.14. Go figure. And then again, when all shit breaks loose, all asset classes converge to 1. But BTC has never experienced a macro econ recession. If it does, will it also be gaining? As CNBC's Thomas Lee once stated BTC is ambidextrous, we all hope so. And although BTC is volatile as f*ck, compared to the S&P, BTC's Sharpe Ratio once again steals the show: BTC YTD Sharpe: 42.9 S&P YTD Sharpe: 20.8 So what's is going to take for BTC to pump again? Do we need the S&P to also pump some? Well as the eve of the 70th anniversary of the People's Republic of China creeps up on us, it's easy to say getting a trade deal done will be the catalyst. But with comments from US officials on Friday threatening to delist Chinese stocks from US exchanges...HOLD on tighter.
BITSTAMP:BTCUSD
by jiamijiang
AUD/USD Divergence Timeframe: 4 Hour Trend: Up -AUD/USD has made strong gains over the last 2 weeks. Price is currently trading around the 0.50 fib level and is showing some rejection at the 0.50 fib level indicating that buying power is slowing down. -Bearish divergence can be seen on the Stochastic RSI, indicating some pull back may be warranted to the 0.382 level. This would be good for the uptrend as old resistance is near that level and could act as support. -Something else to look at is the correlation of NZD/USD (orange line) and AUD/USD, which has an approximate 90% positive correlation on the Daily TF and approximately 85% on the 4 hour TF. NZD/USD had a similar price action a few days ago and broke to the downside on Friday's session, taking a look some price action divergence can be seen there to. I am expecting AUD/USD to follow suite next week and break to the downside for a correction. Ideally NZD/USD would pull up a bit next week so the correlation between the two gets back into equilibrium. -Look for price to possible correction to the 0.382 level (0.6830 area) and old resistance (0.6820 area).
Short
by MC_Mike_Trading
GOLD: News or Technical Analysis?#Perfect Spot and BULL-concernsHey tradomaniacs, in this chart I want to show you my concerns about Gold and why I wouldn`t buy right now. Technically we see a very nice chance to buy right at the trendline, especially since the correction seems to be done according to E.W. and the fact that we are right at the trendline PLUS a very nice round number, which is 1.500 here. The 4h and Daily-Chart would give us a very nice opportunity to buy here with a very great Risk-Reward-Ratio. Buy the questions for me: Who is going to win? TA`s or fundamentals? Will see a bulltrap ? Yersterday we have seen a flood a bullish news for the stock-market: "China`s Premier Li say that us and China should find a solution to the ongoing trade dispute and hopes that trade talks make progess. There was an immediate "risk on" move. European equitiy indices spiked higher as a result of these headlines." Right after we have seen a tweet by Trump saying that he doesn`t need John Bolton, a convonced hardliner anymore. Trumps rating has never been as bad as now and he will have to "calm down" in terms of tradewar talks in order to advoid a recession in the USA which is, and that is what the market believes, caused by the tradewar and its tarrifs. If he wants to be re-elected in 2020, he`d have to push the "risk aversion" and give the market reasons to shift there money into the stock-market. A higher risk-aversion would weaken Gold and push the globale Stock-Market, such as indicies like S&P500. Additionally we see positive reactions by the bulls and in terms of correlations we can see bullish momentums at USD/JPY and USD/CHF, which are correlating with the stock-market. And since everyone seems to bullish, this would provide a lot of liquidity to the Big Players to sell. ;-) So what is going to win? This uptrend? Or will Trump violate the Trendline? LEAVE A LIKE AND A COMMENT - I appreciate every support! =) Peace and good trades Irasor Wanna see more? Don`t forget to follow me. Any questions? PM me. :-)
OANDA:XAUUSD
by Trading2ez
1
How to be a Successful Forex Trader Segment 10Correlation: Correlation is a key concept and can make the difference between both winning trades and losing trades as well as good trades becoming great trades. As those who follow me know, I trade almost exclusively the GBP pairs. Ideally, we want to see all the pairs moving in the same direction. That is a great sign that not only will the trade be successful but that there will be a big move. If there is a correlated directional move, there is a high probability that it will be a big move day. When that happens, once the trade is 1xRisk, we can move the stop to flat and let it run to the profit target. When the pairs are mixed, we have to be more cautious. If they are evenly split, 3 bullish and 3 bearish, we can take the first breakout trade, but not pullback trades. Once that trade is + 1xRisk, we can close ½ our position and move the stop to flat. This is how we make money on not so good days. Monday, Tuesday and Wednesday of this past week were great examples of correlated directional moves. While Thursday, was a split day where at the European open 3 of the GBP pairs were bullish and 3 were bearish. The GBP pairs sold off first allowing for a decent gain in GBPCHF and then rallied. If you master Correlation, your trading will go to the next level. I hope you enjoy this post post and find it helpful. I would appreciate if you "like" it and follow me. Stay Green my Friends :) Allen I am now accepting “pre-order” commitments for my book. I am not asking for any money now. But for those who pre-order, they will receive a priority for one of the bonuses that I am providing. The cost of the book is $54.95 and will be available September 30. If you interested please send me an email to FXGold54@gmail.com
Education
by AGold54
8
The inverse correlation GOLD vs OIL 08:10 05-Sep-19.LOG The inverse correlation GOLD vs OIL 08:10 05-Sep-19 Gold can be used for speculation but is preferred as a safe haven. Crude, on the other hand, can be used as a store of value but is preferred as a speculative play. This combination makes these two assets work great together as mutual hedges. Gold helps offset the risk of higher uncertainty, while oil can take advantage of market moves. Broadly speaking, you could say that gold and petroleum are inversely correlated. There are a couple of major caveats to add to that notion. The first is that more nuance allows for more sophisticated trading. The second is that there is more to oil prices than just the market. born2invest.com Understanding Intermarket Spreads: Platinum and Gold www.cmegroup.com Basics of Futures Spread Trading March 5, 2011 by Craig Turner www.danielstrading.com
OANDA:WTICOUSD
by DORMAN5
The inverse correlation GOLD vs OIL 16:13 04-Sep-19.LOG Gold can be used for speculation but is preferred as a safe haven. Crude, on the other hand, can be used as a store of value but is preferred as a speculative play. This combination makes these two assets work great together as mutual hedges. Gold helps offset the risk of higher uncertainty, while oil can take advantage of market moves. Broadly speaking, you could say that gold and petroleum are inversely correlated. There are a couple of major caveats to add to that notion. The first is that more nuance allows for more sophisticated trading. The second is that there is more to oil prices than just the market. born2invest.com Understanding Intermarket Spreads: Platinum and Gold www.cmegroup.com Basics of Futures Spread Trading March 5, 2011 by Craig Turner www.danielstrading.com
OANDA:XAUUSD
by DORMAN5
The inverse correlation GOLD vs OIL 14:39 04-Sep-19.LOG The inverse correlation GOLD vs OIL 14:39 04-Sep-19 Gold can be used for speculation but is preferred as a safe haven. Crude, on the other hand, can be used as a store of value but is preferred as a speculative play. This combination makes these two assets work great together as mutual hedges. Gold helps offset the risk of higher uncertainty, while oil can take advantage of market moves. Broadly speaking, you could say that gold and petroleum are inversely correlated. There are a couple of major caveats to add to that notion. The first is that more nuance allows for more sophisticated trading. The second is that there is more to oil prices than just the market. born2invest.com Understanding Intermarket Spreads: Platinum and Gold www.cmegroup.com Basics of Futures Spread Trading March 5, 2011 by Craig Turner www.danielstrading.com 08:48 03-Sep-19
OANDA:XAUUSD
by DORMAN5
USD/CHF: Daytrade-Opportunity#SELLEUR/CAD: Daytrade-Opportunity#BUYHey tradomaniacs, welcome to another free signal of Week 36 Nr. 9 How to trade: Wait for the retracement to our entry and sell. ----------------------------- Type: Daytrade Sell here: 0,98652 Stop-Loss: 0,98889 Target 1: 0,98284 Target 2: 0,98056 ----------------------------- LEAVE A LIKE AND A COMMENT - I appreciate every support! =) Peace and good trades Irasor Wanna see more? Don`t forget to follow me. Any questions? PM me. :-)
Short
by Trading2ez
2
SIMPLE educational POST about DXY and how to USE it!Today I have told you to close the position of NZD/USD in profit before it went up. Why did I do this? Because I`m checking correlations. Whenever you trade a MAJOR-PAIR with USD/XXX or XXX/USD do make sure to use the US-DOLLAR-INDEX (DXY) to check it for valid inter-market-correlations for your asset. Whether it`s a positive or negative correlation - you can always take advantage of the correlation if there is one. In this case, the negative correlation was more than obvious. Try it yourself. Fun fact: The weighting of EURO is currently at 56,7%. The US-DOLLAR-INDEX is actuall USD/EUR. You don`t believe? Check it! LEAVE A LIKE AND A COMMENT - I appreciate every support! =) Peace and good trades Irasor Wanna see more? Don`t forget to follow me. Any questions? PM me. :-)
TVC:DXYEducation
by Trading2ez
1
The inverse correlation GOLD vs OIL 12:38 03-Sep-19.LOG The inverse correlation GOLD vs OIL 12:38 03-Sep-19 Gold can be used for speculation but is preferred as a safe haven. Crude, on the other hand, can be used as a store of value but is preferred as a speculative play. This combination makes these two assets work great together as mutual hedges. Gold helps offset the risk of higher uncertainty, while oil can take advantage of market moves. Broadly speaking, you could say that gold and petroleum are inversely correlated. There are a couple of major caveats to add to that notion. The first is that more nuance allows for more sophisticated trading. The second is that there is more to oil prices than just the market. born2invest.com Understanding Intermarket Spreads: Platinum and Gold www.cmegroup.com Basics of Futures Spread Trading March 5, 2011 by Craig Turner www.danielstrading.com 08:48 03-Sep-19
OANDA:XAUUSD
by DORMAN5
GBPAUD LONG OPPORTUNITY This week i've been paying close attention to absolute correlated and negative correlated pairs. In my previous analysis on GBPNZD we were looking for a Long Opportunity so it's only logical to look for the same in this pair. Here I see a Triangle formed so what I understand from this data is price is respecting its support and pushing lower highs leading price to its squeeze. The closer price gets to the end of the squeeze the better, I have a long shot bias in this pair because fundamentally we do have a depreciation in currency for both the Aussie Dollar and New Zealand Dollar. Calculating Targets if placing a buy stop a few pips over the probable descending trend line breakout, we collect the pips from the initial impulsive move before price began squeezing and that's how we calculate our potential target, stop loss would be a few pips below support/ daily ascending trend line. This is a great idea for optimal risk to reward. What invalidates this trade? price breaking below support or breaking the ascending trend line (lower lows) we could then find a short opportunity using the Fibonacci tool at the breakout.
Long
by RiosTrades
NZDCHF, EURNZD CORRELATIONPreviously analyzed the Euro/Kiwi, using Price Action we were looking to go Long (Refer to my previous analysis on EURNZD) We have a 95% Negative Correlation to EURNZD therefore we see price express itself like 2 Positive Magnets. Price is moving in an extreme downtrend which isn't hard to analyze with naked forex. I'd be highly interested in finding a high probable entrance into this pair if price decides to pullback into previous structure which can also lead price to rally at an Important Fibonacci Level before continuing short.
Short
by RiosTrades
Inter Market Correlation updateIn January I posted a lighter version of this chart, with less symbols on one chart. A have to admit it turned out a bit like a can of worms but just because of the many markets comparing it gets more interesting in my opinion. Between January and now and adjusted my Gold expectations and it does perform even better than I expected it would do at first. This while Oil I adjusted down to $64 because of the drop throughout June. Interested in commodities have a look at Platinum from last Friday! On this market correlation chart you also find US Treasury Bond Yields and I recently added Bitcoin (BTCUSD) as an indicator for the crypto market. Remarkable how the yields continued downwards and made an all time low last week. Bitcoin correlates pretty much positive with US30, with a certain delay. One year ago in August and September US30 and DXY correlated negatively for two consecutive months. Something I have seen before once USD devaluation has started to make a steady downtrend, which traditionally takes place halfway August. Predictions from January are still the same and I am expecting stocks to rally one more time before we will see a bigger crash. BTCUSD to follow accordingly, see my related ideas.
OANDA:US30USDLong
by Deep-Peat-Shark
1
BTCUSD Possible Incoming ReversalFundamentally speaking in the long run, BTC like gold and other assets treated as risk-haven now will continue to increase in value if market continues to be risk-off esp with trade "talks" going nowhere and "rumored" recession coming within 2-3 years. But technical-wise, there's highly probable reversal soon at least in the short-run (within this month only) like what I'm seeing in metals esp if DXY forces its way up to 100 and equities start recovering from last Monday's correction. Weekly: Gold: Silver: DXY: Confidence: B (bec this is not aligned with fundamentals and possibility of getting whipsawed, better to wait for the next "tail" to appear before shorting, or set a more conservative sell stop order below 12000 after bearish confirmation candles appear)
BITSTAMP:BTCUSDShort
by aiza_belle
4