Aud/usd

I don't think the latest uptrend on the AUD is particularly meaningful. The perfect correlation with EUR/USD show's it's essentially a drop in the USD than a increase in the AUD.
 
Quote from BigFunky:

I don't think the latest uptrend on the AUD is particularly meaningful. The perfect correlation with EUR/USD show's it's essentially a drop in the USD than a increase in the AUD.
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Once again, I don't understand you guys with this correlation stuff. To me, it's rather meaningless. When I look at EUR/AUD, and I see the rather sharp up move last month, and the rather significant downmove this month, I don't see correlation.
 
I agree that most of the time any apparent correlation is no use at all. But if someone were looking at a chart of AUD/USD and saw a spike upwards, it would be mistaken to immediately come to the conclusion that suddenly everyone wants a piece of the aussie when the same spike has occurred in the EUR/USD. Thus in some trend following situations the very short-term correlations can be useful in disregarding some of the noise.
 
I guess that's more a beginner trait - to think that just because Aussie spikes that someone would believe people suddenly want Aussie. If I see Aussie spike, I immediately check other USD majors. Then I check AUD/NZD and EUR/AUD.

edit: I don't mean to imply that you're a beginner. All I mean is that common sense and experience should tell you that an upmove in AUD/USD doesn't mean AUD is in demand.
 
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