 Many day traders using technical analysis make trading decisions based on the data from only one instrument. Basing your trading decision on other correlated markets and instruments can help offer better insight to the signals you receive in the primary instrument. More aligned data points offer higher probability for a successful trading decision. In Bookmap 6.0 or greater, you can now add correlated instruments to your chart. In this example of crude oil, we've correlated and overlaid the euro-dollar financial future with the yellow line here. Let's take a step back and first cover how the correlation tracker can be used. We'll go over the steps and considerations when using it and provide clear examples. When using correlations, the first step would be to define which correlated instrument or instruments you'd like to use. Please note you can add multiple correlated instruments on a single bookmap chart. Here are a few tips. Select an instrument that is correlated, however not too highly correlated like the S&P E-mini versus the SPY ETF inequities because you'll be less likely to find any price discrepancies that offer any tangible insights. There are many well-known correlated markets to start with. Consider oil versus the dollar index or the euro-dollar or the oil-crack spread. Perhaps correlate the S&P with a sector-leading stock or the soybean crush spread or consider gold and silver versus the dollar index. Research your trading instruments and find the correlation that works best for you. Then study the relationships between the instruments. Items to take into consideration are Understand the relationship in the current market between the instruments. How are they currently correlated and why? Sometimes the same instruments might be negatively correlated due to market conditions. This will help you understand why the spread widens or narrows and how to react to it. Learn the volatility of both instruments. Study the traded volume. This may show you which instruments affects one another. For example, if you take the S&P versus the NQ or NASDAQ, the S&P is traded much more heavily and may give you better insight to the value of the current stock market compared to the NQ. Also, if you are comparing value of one instrument to another, understand it is the discrepancy of that comparative value that offers insight to a potential trading opportunity. If you select to overlay more than one instrument, consider selecting diverse instruments. For example, an interest rate instrument, a stock index, a commodity, or a financial future. Or perhaps you are looking for a spreading opportunity. If so, you will get different spreads when looking at different time frames. For example, a two-minute, a four-minute, or a one-hour chart. Therefore, before taking a trading decision, study these different times and understand the correlation. You can look at spreads in varying time frame methods in Bookmap. For example, you can select to reset the correlation every X number of minutes in this example here by selecting this choice here. Or perhaps you want to keep the reference point always to the left of the chart. Then you would select this option here. This way, always keep the left of the chart as the reference point, and you can easily see the spread in different time frames by zooming in and out. Note that you may see variation in the correlation on the chart. But this is simply due to the zeroing of the correlation on the left of the chart in the relationship to a previous erratic price action. Let's go through an example of crude oil versus the euro-dollar. We'll be comparing the correlated instruments and look for trading opportunities only in crude oil based on price discrepancies in the euro. Since oil is trading in petrodollars, we are looking to buy oil when oil is cheap compared to the dollar or vice versa. In this example, we can see a discrepancy at the 930 equities open. Oil drops quickly. However, the euro is going sideways. We are looking for opportunities to buy crude when the dollar is stronger. There are potential crude buying opportunities here, here, and here. The dollar was a bit stronger in these areas, but crude was lower or had pulled back. Therefore, we have more dollar buying power to purchase crude at these levels. Next, let's look at a spreading opportunity with this same example. I'll utilize the synchronized charts feature in Bookmap and place the two instruments one on top of another. Now I can leg into each instrument in a spread trade with Bookmap's one-click trading. At the 930 open, look how crude oil dropped, but the euro hasn't moved yet. There is a mispricing between the two correlated markets. Therefore, you may consider buying the euro and shorting crude oil. You are looking for the correlation to return to normal. One leg may lose in this trade, but the other should gain, and therefore offer you a profitable trade. Please note there will be times when correlated relationships break down, and such times can be very costly for a trader who does not understand what is occurring. Being aware of a correlation, monitoring it, and timing it are crucial to successful trading. Consider using Bookmap's replay mode as I am here. Study how the spreads are behaving in the past, and also to practice honing your skills at the same moment. Then trade in a live demo account environment. Once you have honed your skills to a professional level, then consider trading in the live markets. For more information, subscribe to our YouTube channel at youtube.com. Or join us on Twitter at bookmap underscore pro. Good trading and thanks for watching.