Currency trading or forex trading is the most robust and liquid market in the world. Also, no other market can beat the massive size of the market where shear value is traded every day. Forex market is the world’s largest market which operates 24 hours a day and 5 days a week.
Currency Trading Pairs
Currency trading is the same as other financial markets where buying and selling of currencies takes place. All the currencies traded on foreign exchange markets are traded in pairs and in real time. A currency pair is made of two currencies. The first currency in the repair is known as the base currency and the second currency is known as the quote currency.
When you are trading currencies, you should know what currency pairs are the best for the investment. To find the best currency pair that works for you, you will require a proper strategy. In starting you may get confused by the large number of currency pairs available in your trading platform.
Best Traded currency pairs
For every trader, the best and most profitable currency pair is different. Investors like to invest most in those currency pairs in which they find the currency of their country. For example, a japanese trader prefers yen over other currencies and a german trader will prefer euro instead of Yen against USD.
It doesn’t matter if you are a newbie or an experienced trader, everyone looks for the most profitable currency pair. BUt it is always difficult to choose one pair over another as most of them perform the same. Here in this article, you will learn different types of currency pairs, most volatile currency pairs, currencies with higher costs and higher spreads and how a trader should choose a currency pair.
The Major Currency Pairs
- EUR/USD (Euro – US Dollar)
- GBP/USD (British Pound – US Dollar)
- USD/JPY (US Dollar – Japanese Yen)
- USD/CAD (US Dollar – Canadian Dollar)
- AUD/USD (Australian Dollar – US Dollar)
- USD/CHF (US Dollar – Swiss Franc)
The United States has the world’s largest economy and this is the reason that the United states dollar is a reserve currency. USD is the preferred currency in most of the trades as it is a dominant reserve currency.
The Minor Currency Pairs
- AUD/JPY (Australian Dollar – Japanese Yen)
- CAD/JPY (Canadian dollar – the Japanese yen)
- CHF/JPY (Swiss franc – the Japanese yen)
- EUR/GBP (Euro – pound sterling)
- EUR/ JPY (Euro – the Japanese yen)
- EUR/CHF (Euro – the Swiss franc)
- EUR/AUD (Euro – the Australian dollar)
- EUR/CAD (Euro – the Canadian dollar)
- EUR/NZD (Euro – the New Zealand dollar)
- GBP/CHF (British Pound – Swiss Franc)
- GBP/CAD (Pound Sterling – the Canadian Dollar)
- GBP/JPY (British Pound – the Japanese Yen)
- GBP/AUD (British Pound – Australian Dollar)
- NZD/JPY (New Zealand dollar – the Japanese yen)
The Exotic Currency Pairs
- EUR/TRY (Euro – the Turkish Lira)
- USD/DKK (US Dollar – the Danish Krone)
- USD/NOK (US dollar – the Norwegian krone)
- USD/SEK (US Dollar – the Danish Krone)
- USD/SGD (US Dollar – the dollar Singapore)
- USD/ZAR (US Dollar – the South African Rand)
Bottom Line
Anyone can start trading currencies just by opening a trading account and depositing money,doing fundamental and technical analysis.
The Forex market is an interesting financial market. Before starting to trade in currencies you make sure to do your homework. Identifying a best currency pair is not easy to trade. The way to achieve this is by getting field experience.
There are various forex currency pairs available for trading. It is essential to trade in the financial asset demo to understand it better before you get started with trading in real life. It is simply because this type of investment, with a leverage effect, is highly risky.
