The stock market is full of various indices. Nasdaq is just one of them. But why is it so popular among traders? What makes it so special? Let’s find out.
How to make profit using forex correlation?
2020-09-28 • Updated
Are you familiar with the concept called “correlation”? In simple terms, correlation is a mutual relationship or connection between two or more things. You can see a correlation in financial markets. Let me show you one simple trick with it!
So, guess, what Google and Facebook have in common? Yes, both are the top companies in the USA, but also they are huge advertisers. That’s why the dynamic of their stock prices are so similar. Therefore, looking at their price charts you see almost identical pictures. Here is the trick: when one is lagging, you can predict with a great possibility its future movement simply by looking at its twin. In other words, if the Facebook stock rises and the Google stock doesn’t rise yet, the Google stock could go up soon.
This trick also works for currencies! You will find a useful table below where you can see positive and negative correlated pairs. To make it clear, positive means they move in the same way and negative means they move in the opposite way.
Sometimes, the correlated charts can diverge. However, even in this case, you can also use the correlation to reduce your risks or even double your profit. Let’s say you decide to buy the AUD/USD currency pair. The secret is that you can take one or two correlated currency pairs and buy them too. In this example, you can buy NZD/USD and GBP/USD. If two of them go up and the third one goes down, you will be in plus anyway. Easy? You can compare charts by yourself and find other correlated stocks and currency pairs!
In this article, you’ll know which currency pairs are the most popular among traders, and what every trader should know about them…
In this article, we will discuss what the term confluence means and why traders should care about it.
Frequently asked questions
How to open an FBS account?
Click the ‘Open account’ button on our website and proceed to the Personal Area. Before you can start trading, pass a profile verification. Confirm your email and phone number, get your ID verified. This procedure guarantees the safety of your funds and identity. Once you are done with all the checks, go to the preferred trading platform, and start trading.
How to withdraw the money you earned with FBS?
The procedure is very straightforward. Go to the Withdrawal page on the website or the Finances section of the FBS Personal Area and access Withdrawal. You can get the earned money via the same payment system that you used for depositing. In case you funded the account via various methods, withdraw your profit via the same methods in the ratio according to the deposited sums.
How to start trading?
If you are 18+ years old, you can join FBS and begin your FX journey. To trade, you need a brokerage account and sufficient knowledge on how assets behave in the financial markets. Start with studying the basics with our free educational materials and creating an FBS account. You may want to test the environment with virtual money with a Demo account. Once you are ready, enter the real market and trade to succeed.
How to activate Level Up Bonus?
Open Level Up Bonus account in web or mobile version of FBS Personal Area and get up to $140 free to your account.