Major Currency Pairs You Can Trade in Forex
The Forex market is dominated by the major currency pairs. These currencies are all traded against each other, so the strength of any currency can vary from day to day. The strength of a currency can be influenced by economic factors in a country or region. The USD is the most popular currency, and is used in more than seventy percent of all transactions. But there are also numerous other currency pairs you can trade in Forex, including lesser-known currencies such as the Brazilian real and Mexican peso.
EUR/USD is the most traded currency pair in the Forex market. It originates from the US and European markets. Its high liquidity ensures that it has tight spreads, which make it an excellent choice for forex traders. The EUR/USD fluctuates depending on news regarding the European and American economies. The recent uncertainty surrounding Brexit has caused volatility in this currency pair. To avoid losing your investment, open a position only after you have developed a risk management strategy and have a clear understanding of the underlying economic data.
The Chinese Yuan is traded as the CNY on the Chinese mainland and the CNH offshore. The Chinese government controls the CNY, so it is essential to stay vigilant and keep an eye on the US-China trade war. Another major currency pair is USD/CHF, or the Swiss franc. The Swiss financial system has historically provided a safe haven for forex traders. This pair is heavily traded in the offshore Chinese market.
The USD/JPY pair is another popular choice for currency trading. This is an interrelation of the US dollar and the Japanese yen. Traders usually fund the USD/JPY with a lower-yielding currency. The EUR/GBP pair is also referred to as the chunnel. The greenback is another popular currency pair, while the Swiss franc is known as the swissy. And the Kiwi is a currency pair involving New Zealand’s currency.
EUR/USD is one of the most popular currencies to trade, due to the high daily volume of trading. This high liquidity results in tight spreads, which attract traders. Because the spread is so small, a large trade on EUR/USD does not have a significant impact on the market. So, this is a perfect opportunity for beginners to trade currencies with large volumes. If you’re not sure about the Forex market, start with a basic Forex course to understand how to trade currency pairs.
The EUR/USD is the largest currency pair in terms of trade volume. Hence, it has the highest liquidity. That means that more traders are buying and selling this currency. The EUR/USD also has relatively lower volatility, making it a popular trade. However, the United States dollar and the European Union are two of the world’s largest economies, so this pair is always subject to price shocks. If you want to learn more about currency trading, check out the Forex website.
Moreover, currency traders should always follow the majors when making their trades. It’s easy to monitor underlying economies of major pairs through the news and social media. This way, they will be better prepared to predict currency price movements. With this kind of information, you can avoid making unnecessary mistakes. Aside from currency trading, it’s also essential to learn more about the issuer’s economy and politics. Furthermore, you should also research the country’s exports and imports to ensure you’re making the best possible trades.
For most people, the most popular currency pair to trade in Forex is the US dollar. These currency pairs are known as majors because they include the US dollar as the base currency and the quote currency. They have lower spreads, which represent the market value. For instance, the CMC market offers over 300 currency pairs that you can trade in through CFD trading or spread betting. If you are interested in acquiring new skills, consider learning about the four main currency pairs in Forex trading.
Pips are used to measure the movement in value between two currencies. One pip equals one tenth of a unit of the base currency. For instance, if the price of EUR/USD is 1.3500 and moves to 1.3501, one pip equals one cent. The smaller the pip fluctuation, the better for the Forex trader. Smaller fluctuations make it easier to make profitable trades. But you should also consider the volatility of the market and the spread when trading Forex.
Another popular currency pair is the USD/CAD. Also known as the ‘loonie’, USD/CAD pairs the US dollar with the Canadian dollar. Canada’s dollar is closely linked to the price of oil. It is priced in US dollars on world markets, and exports of oil directly to other countries make Canada a lot of money. A rise in the price of oil will also likely strengthen the Canadian dollar. So you’d better keep an eye on the price of oil!