EURUSD correlation with both pairs USDCHF and NZDUSD is very strong. EURUSD holds positive correlation with NZDUSD in an hourly time frame ONLY while it establishes strong negative correlation with USDCHF pair both in an hourly and daily time frame.
The correlation number in the image above translate to - when EURUSD moves up then USDCHF moves down and vice versa. If we've taken a long position on EURUSD taking another long position on USDCHF will nearly eat away all my profit should the market move in my favor. Taking a EURUSD long position and a short position on USDCHF simultaneously translates to doubling the EURUSD long position. The only difference will be the difference in pip amount between these two pairs.
However,in a daily time frame, since the correlation between the pair is weak, we can not predict anything with confidence as with an hourly time frame.
