Greetings traders,
this is not the first time that while trading Forex I'm looking at crypto-currency charts, and there is a certain degree of correlation to be observed. This deserves a proper measurement, and I don't advise to get too excited over the fact of correlation between different currency pairs- even if they correlate, it's not always a fact that can be put to your advantage (as a trading decision trigger/signal to buy or sell). It may not be a signalling method by itself, but it may assist you in your judgement, for example, if interpreted correctly, it may give justification to certain price action, in today's case, a decline in BTC/USD price as I would assume. It's always good to know why sth in the market is happening, even if it's too late to make a profit from it. I never used and don't advise you to use correlation as the main means of making trading decisions, it's rather "for your information" only, but it's better to point a certain price behaviour rather than to ignore it.
Please refer to the following pictures that compare the M5 price action of EUR/USD, GBP/USD, BTC/USD and LTC/USD. All of those pairs should exhibit positive correlation, and more or less they do, especially under the influence of FED September meeting, in between 21:00 and 22:00 CET.
http://s8.postimg.org/l8vc7u5kl/eu_bu.jpgThis is interesting because the paths of crypto and fiat currencies meet at some point, and this point is the FED meeting. Their statements influnced stadard Forex pairs, but also influenced BTC/LTC. I'll try to dig deeper and give you some more insights.
Kind regards,
Piotr
