Correlation Indicator

How to Trade With the Correlation Indicator
The Correlation Indicator is most useful when two related markets suddenly stop confirming each other.

For example, EURUSD makes a new high, but GBPUSD does not. That difference can be an early warning that the move is losing confirmation.

What to Watch
Do not focus on the exact distance between price and the comparison line. The second market is rescaled to fit the chart.

Instead, watch:

• Higher highs and lower highs;
• Higher lows and lower lows;
• Failed breakouts;
• Changes in momentum;
• One market leading while the other stalls.

A Simple Trading Setup
A useful setup is:

Important level → Divergence → Rejection → Structure break

Example:

• EURUSD breaks above the previous day's high;
• GBPUSD fails to make a similar new high;
• EURUSD then falls back below the level and breaks a short-term swing low;
• The divergence gives the warning. Price action gives the confirmation.

A Useful Pro Tip
Do not only watch the market making the big move.

Sometimes the better clue is the market that refuses to follow.

If two markets have been moving together and one suddenly stops confirming, pay attention.

Repeated non-confirmation across several swings is usually more meaningful than one isolated divergence.

Best Areas to Watch
Correlation divergence is more useful around:

• Previous day high/low;
• Weekly high/low;
• Major swing levels;
• Support and resistance;
• Session highs and lows.

Random divergence in the middle of a range is usually much less useful.

Important
This is not a Buy/Sell indicator.

Avoid rules like:

Yellow line above price = sell

or

Yellow line below price = buy

The better question is:

Is the second market confirming the move?

When the answer suddenly becomes no, that is where the indicator becomes interesting.

How to use this indicator?

Its the Bollocks, just what I needed to trade my EA with negative pairs.

The indicator is broken. Please fix it.
Thanks.

Just checked, it works fine for me ➡ https://www.best-metatrader-indicators.com/wp-content/uploads/2021/07/eurusd-vs-gbpusd.png

Does it work with CrudeOil? How?

Thanks!

good indiccator , thx