Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR/USD

This is a discussion on Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR/USD within the First Steps forums, part of the Reception category; can someone explain this to me simply? in the real world everything is linked to the Dollar (Fiat currency system) ...

Reply
 
LinkBack Thread Tools Search this Thread
Old Jul 31, 2013, 8:24am   #1
Joined Jul 2013
Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR/USD

can someone explain this to me simply?

in the real world everything is linked to the Dollar (Fiat currency system) so how can some currency pairs be negative in correlation to eachother?

thanks good people.

Last edited by hybrid; Jul 31, 2013 at 9:21am.
hybrid is offline   Reply With Quote
Old Jul 31, 2013, 10:52am   #2
 
Shakone's Avatar
Joined Feb 2009
Re: Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR

Perhaps rather than ask

Quote:
Originally Posted by hybrid View Post
how can some currency pairs be negative in correlation to eachother?

You could ask, is it possible for all currencies (or exchange rates) to be positively correlated to eachother?
Shakone is offline   Reply With Quote
Thanks! The following members like this post: rsh01
Old Jul 31, 2013, 11:00am   #3
 
Giovan's Avatar
Joined Apr 2013
Re: Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR

Perhaps, you better refer to you lecture notes on correlation.
Its easier to read on your own.
Check out some infor about carrytrade too
Giovan is offline   Reply With Quote
Old Jul 31, 2013, 11:03am   #4
Joined Nov 2001
Re: Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR

I've wondered that, myself. The pair does not seem to be named correctly. Should it not be JPN/USD if the chart says 100?
Splitlink is offline   Reply With Quote
Old Jul 31, 2013, 12:33pm   #5
Joined Jul 2013
Re: Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR

hybrid started this thread
Quote:
Originally Posted by Shakone View Post
Perhaps rather than ask




You could ask, is it possible for all currencies (or exchange rates) to be positively correlated to eachother?
But it is possible because they are - all are linked to the dollar...which is linked to....nothing.....as the gold standard was abolished in the 60s (or 70s).

I am still none the wiser to my original Question
hybrid is offline   Reply With Quote
Old Aug 3, 2013, 9:40am   #6
Joined Jul 2010
Re: Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR

correlations be damned.take them as arbitrary.they are there when they are there and not when they are not.and they are usually not when its become customery wisdom that they are.
aag100 is offline   Reply With Quote
Old Aug 3, 2013, 2:05pm   #7
 
Shakone's Avatar
Joined Feb 2009
Re: Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR

Quote:
Originally Posted by hybrid View Post
But it is possible because they are - all are linked to the dollar...which is linked to....nothing.....as the gold standard was abolished in the 60s (or 70s).

I am still none the wiser to my original Question
So start with the correlation between EUR/USD and USD/EUR. Both are 'linked' to the dollar. Next extend the thought to something less trivial, i.e. not just the inverse relationship, but consider more currencies.
Shakone is offline   Reply With Quote
Old Aug 3, 2013, 8:20pm   #8
Joined Jul 2013
Re: Why does the USD/JPY link to the EUR/JPY, but the USD/JPY is negative to the EUR

hybrid started this thread
Quote:
Originally Posted by Shakone View Post
So start with the correlation between EUR/USD and USD/EUR. Both are 'linked' to the dollar. Next extend the thought to something less trivial, i.e. not just the inverse relationship, but consider more currencies.
ah, a great way of putting it - thank you very much.... i am there now :-) apologies for being slow.
hybrid is offline   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
Did you know Eur/Usd, Usd/Jpy, and Eur/Jpy are all connected?? shakespeare515 Forex 54 May 8, 2013 12:23am
EUR/USD, GBP/USD, USD/JPY, CHF/JPY (Forecasts) TiminSolution Forex 1 Sep 26, 2011 10:03am
USDx, GBP/USD, EUR/USD, USD/JPY & the S&P 500 elliott wave VIDEO afarghaly9 General Trading Chat 3 Jun 12, 2011 6:49pm
GBP/USD, EUR/JPY, USD/CAD and USD/JPY Technical analysis TraderDTS Forex 4 Mar 8, 2010 5:45am
EUR/USD and USD/JPY - why isn't there an inverse relationship? bcc9274 Forex 3 Aug 11, 2009 7:48am

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)