Correlation 101: Why You Should Use It In Crypto Trading
Have you ever noticed that when a certain currency pair rises, another currency pair falls?
Regardless of the answer, you should. This NWC tool was developed to do the hard work for you…
Let’s firstly put currency correlation in perspective, it describes the mutual price relationship between two cryptocurrencies.
Based on historical data (daily, weekly monthly), correlation displays us an insight on how closely the prices of two assets moved. Most of the time, the secrets of the future can be found in the past…
Does NWC price usually rise when BTC does?
How closely ATOM price follows ETH price?
Take a look at the table first:
· Values from 0 to 1 suggest a positive correlation between assets — assets price moves in the same direction.
· Values from -1 to 0 suggest a negative correlation between assets — assets price moves in a different direction.
· Zero means no correlation between the assets AT ALL — the prices move totally randomly.
How to read NWC Correlation table and use it to your advantage?
NWC and BTC had a very strong positive correlation of 0.89 last week. It means that NWC rallied 89% of the time when BTC did. (13.3.-20.3.2020)
PAX and BTC had a negative correlation of -0.14 which implies that PAX fell in price 0.14% of the time while BTC was rising. (13.3.-20.3.2020)
So, be sure to take a look at the table before placing your next trade.
It really does make a difference, see it for yourself!
Visit Newscrypto Platform👈, find Correlation tool in Advanced Tier!