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What Is the Correlation Between Currency and Stock Trading?
Is there any difference between them? If any, can you explain in detail what they are?
well…
The title and the description are different.
The title says whether there is a correlation between currency and stock trading. The answer is yes. They are strongly correlated.
But in the description you are asking if they are different or not. Everybody knows that they are different. Stocks are shares of companies, and currencies are currencies. Everybody knows this.
Is the trading approach and strategy the same?
Yes, all the trading techniques and chart analysis are the same.
The other thing that is the same in the two is the risk that is involved and the risk of getting it wrong.
Currencies can be use anywhere to goods and pay for services while Stocks/Shares are domicile with the brokers.
There are stocks which are directly correlated with currencies eg when USD is doing well most stocks also perform well in USA.
There is a correlation between the US Dollar Index and the stock indices like the Nasdaq and the S&P 500.
Currency is correlated to stock because of their risk appetite. And also when economy of a country is doing well, both their stocks and currency will appreciate in value..
The stocks and the currency are struggling correlated.
When the country’s stocks are going up, then you can buy that currency because that currency is getting stronger now and will rise. Similarly,a country whose stocks market is facing a decline you can sell that country’s currency because now the currency is getting weaker and will probably fall down.
Nikkei and USD JPY have shown a strong correlation.
GOING BY YOUR ANSWERS SO FAR, A GOOD FOREX TRADER CAN ALSO BE A GOOD STOCK TRADER
Yes if you’re a good Trader you can make profit from stock and currency market. Some times depending on some factors the can do the opposite meaning if for example the stock of the country rise the currency go in the opposite direction. Most of the time both go in the same direction and you can make profit if you know when it happens .