A two‐receiver steerable correlation system intended to process signals from point sources at a large distance from and in a common plane with the receivers will give a predicted source direction which is generally different from the actual source direction when the source distance from the receivers is not large. The exceptions are broadside or end‐fire sources for which the predicted and actual directions are equal. Apart from these cases, the predicted direction is always closer to broadside than the actual direction. Other results include the fact that a given predicted direction corresponds to a source location at any point on a corresponding hyperbolic arc.