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Why is EU correlated with Oil?

  • Post #1
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  • First Post: Aug 21, 2008 5:11pm Aug 21, 2008 5:11pm
  •  Seaward22
  • | Joined Jan 2008 | Status: Member | 417 Posts
  • Post #2
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  • Aug 21, 2008 5:22pm Aug 21, 2008 5:22pm
  •  pippero
  • | Joined Oct 2007 | Status: Trend following is for teens | 216 Posts
1) oil is inversely correlated to the dollar +
2) the euro makes up more than hald of the US Dollar index =

3) the euro and oil move in tandem
 
 
  • Post #3
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  • Aug 22, 2008 4:30pm Aug 22, 2008 4:30pm
  •  Seaward22
  • | Joined Jan 2008 | Status: Member | 417 Posts
I still don't understand. Looking at this weeks oil and EU charts, they are almost identical.
 
 
  • Post #4
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  • Aug 23, 2008 5:10am Aug 23, 2008 5:10am
  •  Rabid
  • Joined Jan 2008 | Status: Lunatic Supreme | 1,840 Posts
Oil is priced in dollars. The EURUSD is largely driven by the changes in the value of the dollar.

Therefore changes in the USD would result in large changes in the EURUSD and oil. The common correlation is the value of the dollar.
 
 
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  • Aug 23, 2008 8:58am Aug 23, 2008 8:58am
  •  WhiteSwan
  • | Joined Aug 2008 | Status: Member | 12 Posts
Quoting Rabid
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Oil is priced in dollars. The EURUSD is largely driven by the changes in the value of the dollar.

Therefore changes in the USD would result in large changes in the EURUSD and oil. The common correlation is the value of the dollar.
Ignored
which is ahead - oil or USD / EURUSD?
there was good article in Kathy Lien homepage and seemed that oil
 
 
  • Post #6
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  • Last Post: Aug 23, 2008 9:03pm Aug 23, 2008 9:03pm
  •  Rabid
  • Joined Jan 2008 | Status: Lunatic Supreme | 1,840 Posts
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which is ahead - oil or USD / EURUSD?

Which one lags less (or correlates better?), oil or the euro? Probably oil, supply and demand have been more constant there where as the eurozone has it's own economic issues.
 
 
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