My question is about the major currencies dependence on commodities. For example Australia based on gold, US correlate better with oil. Is there somewhere to get more information on this?
Also another question about currency pairs dependence upon one another. I read somewhere that looking at multiple charts we can see patterns of one pair influencing the future patterns of another pair, but there were no examples. Can anyone explain this? Do these cross currency patterns really exist, or are they just natural wave patterns that happen to correlate.
Be careful of conflating “correlation” with “dependence”. Unless a country’s trade balance is largely impacted by the price of a certain commodity (and some are, but the US isn’t) then it’s currency’s value is not “dependent” on a commodity. It may be correlated, though.
Also another question about currency pairs dependence upon one another. I read somewhere that looking at multiple charts we can see patterns of one pair influencing the future patterns of another pair, but there were no examples. Can anyone explain this? Do these cross currency patterns really exist, or are they just natural wave patterns that happen to correlate.
Currency pairs are a series of mathematical relationships which establish the value of one currency in terms of another. Sometimes you can see one currency lead. Sometimes you can see a cross move before a major (EUR/GBP moving before EUR/USD) because trading is initiated in the cross.
TY, I now understand what the difference is between a correlated and dependent commodity. How do these affect currency differently. Is it that a dependent must follow, and correlated only tend to follow? Can you tell me where I can find more information on currency pairing commodities?
I understand that EUR/GBP and EUR/USD are related because the EUR is common b/w the pair. I was wondering how far ahead do these predict (is it seconds, minutes…), can we predict which pair we follow and which will lead based on trade volumes, or is this random?