Nayo it is not just theory, but a mathematical reality. It is also not a "correlation triangle" as you mentioned, because it is simple algebra.
Let me first correct an error in your formula. You mean A/B * B/C = A/C, etc.
In your example, and using the principles of algebra when you take the G/U * U/J, that would equal G/J, because we have a U in both the numerator and the denomnator, so they cancel each other out by virtue of U/U = 1, and so we are left with G/J.
In order to prove this, we just apply the knowns to the unknown variables. The GBP/USD is currently 1.5301, the USD/JPY is 86.65. The 2 multiplied together yields 132.57. Current price on the GBP/JPY is 132.58. It is off by one cent, but allow for a margin of error.
This is what makes the forex markets impossible to manipulate, is the mathematical correspondence.
I'm also glad you brought these 3 pairs up. My forecasts showed the GBP/USD, possibly going down once 1.5447 was hit, and showed a definite move down for the USD/JPY. I did go short the GBP/USD on Friday, but an even wiser choice would have been the GBP/JPY.
Click on my thread below. You will find a ton of more excellent information in there that I hope you will find interesting. You can drop by, kick your shoes off, enjoy the excellent analysis, the charts, ask questions, make comments, and even disagree. I am always game to hearing what the dissenters might have to say, even though I don't have too many, because my thread is highly transparent as you will find.
Pictured, is my buddy, Tucker. I call him m'boy. People have told me they see the resemblance. My response is always, "Now come on. I'm not that handsome." lol
Hi, I am Nayo . new member in this forum
I recently visited
www.yourows.com
I saw a theory: Correlation Triangle
correlation is not based on Pip, but based on the indicators.
The calculation is very simple:
AB + BC = AC. example: GU + UJ = GJ
there who understand this theory?
🙁
Please give me an explanation
Thanks, succsess for all