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pairforex

Hey namco,

wow , what a q, as you know if there was something sure about this marker we all have been reach. But no dout if there is a strong correlation between the forex and stock market, but don't take it a sure thing. Have a good one,

adam,

4 months ago

Boripat

Well that's risk correlation... People buy stocks when they feel comfortable with the economic outlook, and of course, they buy higher yielding currencies against safer currencies at this time too. It is no surprise seeing the s&p500 index correlates with currencies like the audusd, when people dump their stock, like what's happening now, there will be people who also at the same time dumping riskier currencies, like the euro or the austrlian dollar and head back to safe heaven like the japanese yen. Also many times, we see bonds rise as people flee to the safety of the us debt in time of economic trouble.

4 months ago

Cyclopip

Recently, we have seen some types of correlations hold between currencies and equity (stock) markets. You should take note that risk sentiment is driving the market right now. This means that depending on how confident investors, they will either pick riskier assets or safer assets. Because of all the financial turmoil that the recession has caused, many traders have decided to unwind their positions in riskier assets (such as stocks) in favor of the dollar. Remember, the dollar is considered a 'safe-haven', primarily because it is considered the world's reserve currency. Now, when traders have become more confident about global recovery, they build their positions in stocks and other higher yielding currencies. Just remember that this has been true as of late, and hasn't always been this way. As people always say, the markets are always changing, and what is true today might not be true tomorrow. The important thing is to be able to stay on top of the market and judge what is the dominating theme.

4 months ago