EU & GBP/USD Correlations

Hi,

If the GBP/USD and USD/CHF have made big moves before the EUR/USD is that a indication that the EUR/USD is most likley to move big in similar to the GBP/USD?

Thanks.

If EURUSD did not follow (leader-follower correlation with GBPUSD being the leader) and GBPUSD is already e.g. 50 pips off you are better not following with a EURUSD trade.

In general EURUSD / GBPUSD / (USDCHF - take that one out since it always follows instantly either one) are symetrically correlated. Either one can (not will) predict a move in the other one since both have substantial USD volume -> if both move USD is being sold/bought -> affects the whole market in some way.

Don't chase a train that has long left the station.

If you see GBPUSD breaking out watch if EURUSD follows shortly after and check EURGBP. If EURGBP is going short -> if at all then take GU. If EURGBP is shifting to the long side -> take EURUSD.

http://forexautomaton.com/research/3...-correlations-