yes they are highly negatively correlated, quite well as a matter of fact! no, one would not use their own strategy to determine startup, they could…but it’s arbitrary as it doesn’t really matter when you enter the trade so long as the pairs are correlated at that point in time. yes, 1.0 corrleation indicates perfect postive correlation (if one goes up, the other does too), -1.0 indicates a perfect negative corelation (if one goes up, the other goes down). You are on the right track!
I haven’t bothered with this thread at all for that reason. I read it after the first couple of posts and immediately realized this was another freak show starting up.
It fascinates and scares me to see how people will throw their brains out the window for the promise of easy money.
Very sad. This thread is a complete waste of time. Spare yourselves, people!
A correlation of +1 means that if pair A goes up, pair B will also go up (assuming the correlation holds). So in this case, to minimise risk you buy one pair, and sell the other. So GBPUSD and EURUSD are normally strongly positively correlated
A correlation of -1 means that if pair A goes up, pair B will go down, or if pair A goes down, B will go up. In this case to minimise risk, you’d either buy both pairs, or sell both pairs.
A correlation of 0 means that the behavior of the pairs is not related, sometimes they might go up or down in step, and sometimes they might do the complete opposite.
The easiest way of visualising this is to download OHLC data into excel, and plot one currency against another, then plot a regression line, the line will slope up or down !
If you do this, you’ll also get an idea as to the varience in the correlation coefficients, and that might spark a few ideas 
You are the most level headed guy on BP.
You’re not too bad yourself
What is the method? I only see a vague concept.
So what is the method that is going to stop MOST traders from losing again? Trying to stay on topic here.
I hope I never get to a “level” where I consider learning a waste of time :rolleyes:
So more questions 
Yes details are vague…apparently you just pick a highly correlated pair, and then what…just enter any direction? Or using my 2 pair examples AUDUSD/USDCAD, I would buy one low and sell the other high? since that’s about how they’re currently positioned on the charts.
Win, loss, win, loss…hmmm…so there will always be a winner & a loser? Never both winners or losers?
The calculation is simple enough, there are 1001 websites covering this sort of stuff.
Timeframe has a massive effect on correlation. If you look at the correlation between say GBPUSD and EURUSD over the last 50 bars, on weekly chart its currently +78.3, +82.2 on the daily chart, and negatively correlated at -52.4 on the hourly chart !
Would you consider learning from someone who doesn’t have a clue what they are teaching, a waste of time? …hypothetically speaking.
Have you no trust in your own judgement, that you entertain the most obsured ideas posed by johnny come lately on BP? Certainly that would be a waiste of time. Unless of course all ideas are good ideas…then we can all make pips, as long as we learn something from someone.
Brickman, you said earlier today that you were here to learn, and look!! You have become an expert alredy.
Joined Baby pips today, found this thread, and here you are, teaching me! So well versed in the magical ways of 8 month trader gone guru, TradingLiberation.
Ok, so that’s hedging then?
Yes, you are certainly acting like the expert, with your confidence to carry on this thread, and speak for the starter.
Honsetly, I’m supposed to believe that you just join BP today, only posted in this thread, spend ALL DAY defending it!..and nothing fishy? pleeeeese. Some here are not that stupid. Unfortunetlly, only some. But people that know better are not going to make this as easy as your thought it would be. WE ARE WISING UP, AND WE ARE FED UP WITH THESE ANTICS.
No its just a simple least squares regression, and the correlation coefficient is the R, or R squared value (cant remember which off the top of my head !)
Don’t think I’m just sitting here waiting for the only info to come from one source…we are on the internet.
I never suggested you get your info from one source, just credible sources. Surely you can find better…we are on the internet.
Correlations in currencies is something I am only familiar hearing about, and played around with a basket strategy that was put forth here on BP. Other than that, that’s all I know about it, so however/whoever brings it up and I wish to discuss how it works, known/unknown strategies, etc, in a place I’m comfortable trying to do so is something I’d like to be able to do. So thank you very much for your concern but being that [B]I can [/B]think for myself, I’d like to be able to come to any conclusions on my own.
Actually I don’t think BP has a section on currency correlations in their school? Is there?
There is A TON of info about correlation if you want to really learn…why you chose learn from this thread is beyond me…enjoy.
I’m not learning [B]just[/B] from this thread…geez…: but it’s kinda hard to ask a webpage a question…:rolleyes: