Forex Correlation Matrix
Visualize how currency pairs move in relation to each other. Identify highly correlated or inversely correlated pairs to avoid double exposure and discover hedging opportunities.
| EURUSD | GBPUSD | USDJPY | AUDUSD | USDCAD | USDCHF | EURGBP | EURJPY | GBPJPY | NZDUSD | |
|---|---|---|---|---|---|---|---|---|---|---|
| EURUSD | 1.00 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 |
| GBPUSD | -0.08 | 1.00 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 |
| USDJPY | -0.08 | -0.08 | 1.00 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 |
| AUDUSD | -0.08 | -0.08 | -0.08 | 1.00 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 |
| USDCAD | -0.08 | -0.08 | -0.08 | -0.08 | 1.00 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 |
| USDCHF | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | 1.00 | -0.08 | -0.08 | -0.08 | -0.08 |
| EURGBP | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | 1.00 | -0.08 | -0.08 | -0.08 |
| EURJPY | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | 1.00 | -0.08 | -0.08 |
| GBPJPY | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | 1.00 | -0.08 |
| NZDUSD | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | -0.08 | 1.00 |
What is Currency Correlation?
Correlation measures the statistical relationship between two currency pairs, expressed as a coefficient from -1.00 (perfect inverse movement) to +1.00 (perfect co-movement).
How to Read the Matrix
- +0.75 to +1.00: Strongly correlated — buying both pairs is essentially doubling the same position and risk.
- +0.25 to +0.75: Moderately correlated — pairs tend to move in the same direction but with significant differences.
- -0.25 to +0.25: Low or no correlation — pairs move independently.
- -0.75 to -0.25: Moderately inversely correlated — useful for natural hedging.
- -1.00 to -0.75: Strongly inversely correlated — buying one and selling the other creates a near-hedge.
Why Correlations Matter
Understanding correlations helps traders avoid hidden concentration risk. For example, going long EUR/USD and long GBP/USD at the same time is effectively a 2× position against the US dollar. If the dollar strengthens, both positions lose.
Correlations also shift over time due to interest-rate cycles, risk sentiment, and economic events — which is why this tool offers 30-day, 90-day, and 1-year timeframes.
Common Correlation Pairs
Some well-known relationships:
- EUR/USD ↔ USD/CHF: Strong negative correlation (~-0.93) because the Swiss franc and euro often move together.
- AUD/USD ↔ NZD/USD: Strong positive correlation (~0.92) due to similar export-driven, commodity-linked economies.
- EUR/USD ↔ GBP/USD: Positive correlation (~0.87) as both are major pairs denominated against USD.