Why is gold correlated to yen?
In reality, there is no proper explanation to this. Although the fact that gold and yen both share the status as a safe haven does in a way validates this correlation. But it is merely scratching the surface. Correlations in the markets come and go. A more recent example that traders can recollect was the short term correlation between oil prices and stocks in the first half of the year, which soon faded. This brings an important point to mention, which is that with any correlation you cannot take it for granted. Therefore traders need to constantly, and at regular intervals check on the correlation between gold and yen. For example, Gold and USDJPY have a -94% correlation on a weekly basis. However, this fluctuates and therefore traders should always keep an eye out on any significant changes.
In reality, there is no proper explanation to this. Although the fact that gold and yen both share the status as a safe haven does in a way validates this correlation. But it is merely scratching the surface. Correlations in the markets come and go. A more recent example that traders can recollect was the short term correlation between oil prices and stocks in the first half of the year, which soon faded. This brings an important point to mention, which is that with any correlation you cannot take it for granted. Therefore traders need to constantly, and at regular intervals check on the correlation between gold and yen. For example, Gold and USDJPY have a -94% correlation on a weekly basis. However, this fluctuates and therefore traders should always keep an eye out on any significant changes.