Hello traders, could someone please orient me? I want to know which indices group currency pairs. For example, the dollar index to analyze EUR/USD. And which raw materials are linked to which currency. For example, oil with CAD. I need this info to do analysis of strength and weakness between currencies and thus make clearer decisions without falling into unnecessary hedges. Is there anything else I should consider besides fundamentals? Thank you in advance.
For starters, look at the DXY for everything related to the USD. If the DXY goes up, usually EUR/USD goes down and vice versa.
The CAD moves very closely to oil, as you say. Also the AUD with gold. That can give you advantage if you know how to interpret it.
Don’t forget that NZD usually goes hand in hand with dairy products, even if it doesn’t look like it. If you want to do serious tests, that counts.
If it's your thing to avoid hedging, focus on the dollar index and how it reacts to macro news. It's key.
Eye on the euro index (EXY)
What you're doing is called intermarket analysis, it's powerful if you combine it with price action. Don't underestimate it.
I use the DXY index, oil and gold to make decisions. They help you see which pair is strong and which one is loose.
You can also look at the bonds. When the yield of US bonds rises, the dollar tends to strengthen.
Consider correlations. USD/CHF and EUR/USD usually move in opposite directions. Very useful to confirm tickets.
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