A forex Traded Currency Pairs is a quote of two separate currencies, with the value of one currency quoted against the value of the other. First currency specify a currency pair known as the “base currency”, and the second currency known as the “quote currency”.
Foreign exchange market commonly called as the forex market, is where currency pairings are traded. It is the world’s largest and most liquid financial market.
The currency market is open 24 hours a day, five days a week with massive trade volume.
Top 5 Traded currency pairs in forex:
EUR/USD – Fiber:
Euro to US Dollar currency combination known as highest volume forex pairs and it is the most traded forex pair in the market, combining the currencies of two of the world’s most powerful economies.
It is less volatile than other currency pairings and Most traded currency pairs in forex market because of its high liquidity; nonetheless, Forex traders should be mindful that even the most liquid instruments may become extremely volatile under specific situations.
USD/JPY – Gopher:
After EUR/USD, another highest volume forex currency is the US Dollar to Japanese Yen. Generally, USD/JPY pair has relatively high liquidity; comparing, the JPY considered as a “safe heaven” currency during times of global economic instability.
Political and economic developments in China and Korea on the other hand, have a significant influence on the JPY, and the currency is sometimes referred to as the “Gateway to the East.”
GBP/USD – Cable:
The British Pound to US Dollar forex currency combination known as ‘Cable’ since the first currency pair exchanged over the Atlantic Ocean via telephone lines or cables. The United Kingdom and the United States are two of the world’s greatest economies, with particularly strong forex trading ties.
However, the persistent uncertainty surrounding the United Kingdom’s plans to leave the European Union (“Brexit”) has increased volatility in the GBP/USD. The pound is also highest volume forex pairs trade against the euro, as seen by the EUR/GBP cross pair.
AUD/USD – Aussie:
Another significant pair, this one is made up of the Australian dollar and the US dollar. The value of commodities exported by Australia, such as iron ore, gold, and coal, as well as interest rates set by the Reserve Bank of Australia and the US Federal Reserve, influence this pair.
USD/CHF – Swissie”
The US dollar and Swiss franc currency combination, popularly known as trading the “Swissie”, may appear to be an unexpected inclusion given Switzerland’s small global economy. However, this currency combination is popular because to Switzerland’s strong image. Despite being less liquid than the other major pairs listed, it remains a popular choice among traders.
Tips for Trading Currency Pair:
If you’re new to forex trading, stick to liquid currency pairings such as EUR/USD or USD/JPY. Then examine the fundamentals and technical until you understand what moves the currency pairings.
When trading currencies, determining the optimum leverage is critical. Many new forex traders lose their money because they utilize too much leverage.
A forex trading strategy can assist traders in being consistent and disciplined. This can lead to profitability while discouraging loss-causing behavior.
Select the appropriate trading time frame for your requirements. Swing trading, day trading, and scalping are all options depending on which one appeals to you the most.
A currency pair’s popularity gives the finest trading circumstances. As a result, you should start with such pairs when selecting a currency pair, consider its intraday activity. Some of them only exchanged at certain times of the day.
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