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Forex Pairs Correlation Matrix 2026

Major, minor, and commodity pair correlations — understand your portfolio risk before placing trades

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Strong positive (0.8–1.0) — move almost identically
Moderate positive (0.5–0.8) — often move together
Weak positive (0.2–0.5)
No correlation (−0.2 to 0.2)
Weak negative (−0.5 to −0.2)
Moderate negative (−0.8 to −0.5)
Strong negative (−1.0 to −0.8) — move opposite

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FIELD 24

Correlation changes with timeframe and lookback

Use the printable matrix as an orientation aid, then calculate correlation on the returns, timeframe, and date range relevant to the portfolio. Price-level correlation and an old long-term average can give a misleading sense of current exposure.

  1. Use returns rather than raw price levels.
  2. Declare the rolling lookback before viewing results.
  3. Compare calm and stressed periods.
  4. Translate correlated trades into combined dollar risk.

A correlation cell is a dated measurement, not a permanent property of two symbols.

Correlation Matrix — Major & Key Pairs (approximate, based on historical averages)

Important: Correlations are not fixed — they change with market regime, risk sentiment, and central bank policy. The values above represent typical averages over multi-year periods. During risk-off events (crisis, flash crashes), correlations can temporarily approach ±1.0 across many pairs simultaneously. Always check current correlation data from your broker or a live correlation tool when making portfolio decisions.

Key Correlation Relationships to Know

Pair RelationshipTypical CorrelationWhy It Matters
EURUSD ↔ GBPUSD+0.80 to +0.90Both pairs move together vs USD. Trading both long = doubling USD exposure, not diversifying.
EURUSD ↔ USDCHF−0.85 to −0.95Near-perfect inverse. Long EURUSD + long USDCHF ≈ hedged position. Use for risk reduction.
EURUSD ↔ USDJPY−0.40 to −0.60Moderate inverse — not reliable enough to assume hedge. Check weekly before using.
GBPJPY ↔ EURJPY+0.90 to +0.96Extremely correlated — both JPY cross pairs. Don't trade both as separate diversified ideas.
XAUUSD ↔ EURUSD+0.50 to +0.70Gold often moves with EUR vs USD (both weaken when USD strengthens). Stacks risk if combined.
AUDUSD ↔ XAUUSD+0.70 to +0.85Australia's economy is gold-linked. When gold rises, AUD typically follows. Doubles commodity exposure.
USDCAD ↔ Oil prices−0.60 to −0.80Canada exports oil. Rising oil → stronger CAD → falling USDCAD. Watch WTI before trading CAD.
NZDUSD ↔ AUDUSD+0.85 to +0.95Both commodity/risk-on currencies. Almost always move together — not two separate ideas.
USDJPY ↔ S&P 500+0.50 to +0.70Risk-on: stocks up → USDJPY up (carry trade). Risk-off: stocks crash → JPY strengthens sharply.

Portfolio Risk Rule

The multi-pair trap: Trading EURUSD + GBPUSD + AUDUSD all long at the same time is not three separate trades — it is three times your USD short exposure. If USD rallies, all three hit stop simultaneously.

Practical rule: If the correlation between two pairs exceeds +0.7, treat them as one trade for risk purposes. Only risk your intended % on one of them, or split the position: 0.5% on each instead of 1% on both.

During backtesting: Test pairs in isolation first. Once you understand each pair's individual edge, then study how combining them affects overall portfolio risk. FXAbsolute lets you replay any pair — test correlation awareness by backtesting EURUSD and GBPUSD setups on the same date and comparing how they moved.

Beginner exploration

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