Forex Trading

What are the Best Currency Pairs to Trade?

As there can be less liquidity during night time trading sessions, you will often find that forex spreads tend to be higher than usually. This can make it difficult for scalping systems that rely on small pip movements. As I have mentioned above, night time as going to depend on where you are. Generally speaking, forex scalping strategies tend to work best on less volatile currency pairs from my experience.

best forex pairs to trade

No matter the change comes in the value of the euro or dollar, it leaves an effect on each other and also on other currencies. Although the pound bounced back in the years that followed, it never quite reached the 2007 record and eventually settled at about £1.60 for every dollar. The national currency of Japan is the Japanese yen , which created as part of the Meiji restoration’s effort to modernize and westernize Japan’s economy. The value of the yen plummeted during World War II. But it has since started to rebound after hitting a low after the 1973 oil crisis.

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I should retire in about 1 year, then will devote more time to Forex. I have morphed into a 75% or more price action trader with the other windsor broker review 25% using indicators that I keep changing to help confirm the trades. Just wanted to let you know how much your info is appreciated.

The value of the pound has been significantly impacted by two significant occurrences over the past ten years. Due to the Great Recession’s global effects, the price of the pound experienced substantial fluctuations between 2007 and 2008. Technical analysis is taught in a variety of technical analysis courses. Any opinions, news, research, analysis, prices, or other information contained on this website is provided as general market commentary and does not constitute investment advice. That may be so, but my article is based on my experiences and I truly don’t want people focussed on the wrong pairs. I believe that GBPUSD is a better pair than the USDCHF to trade/follow.

Your goal is to place your order before the new trend takes off. You don’t want to wait for the trend to be established but try to anticipate it, to increase the potential profits of your trade in the face of higher risks. It’s important to set up a stop loss order to protect yourself, usually at the consolidated market price’s breaking point.

  • Given the classification above, the most liquid, and thus the least susceptible to large price swings, pairs are majors.
  • Smaller global currencies, especially those that are new to the forex market, will have less historical data, making their output more difficult to forecast.
  • If you do want to scalp currency pairs at night, you might want to look for an ECN forex broker such as IC Markets.
  • If it wasn’t obvious by the name, this is when you trade the forex market during the evening.
  • The pair positively correlates with EUR/USD and negatively correlates with USD/CHF.

Therefore, I would be looking at what currency pairs are the least active during the evening in your time zone. And the answer is as simple as can be, the safest currency pairs are the most stable ones. Read on to learn which currency pairs are the best to start your trading journey. Most of the top 10 Forex currency pairs to trade in 2022 are suitable for trading based on a trending market. There is a lot of historical data for the most predictable currency pairs, making it easier to do technical analysis from the charts. The EUR/GBP is a perfect example of a lack of price stability, showing you when not to trade Forex.

I hope this will help you choose currency pair to trade and be profitable. Using less volatile pairs can make your trading harder because you will have a hard time to make money or to enter into the trade. Then you need volatility and that means the currency pair will change the price often. Currency pairs have several characteristics and one of them are liquidity, volatility, spread and strength. So they also have high spreads which can be really hard to trade. This is a part you should be familiar with if you are not and that is about the type of currency pairs.

Top 10 Forex Pairs To Trade

Why have we added this currency pair to the top 10 currency pairs to trade? Usually, EUR/GBP is an excellent pair to trade, with high probability setups and good liquidity. This guide takes a close look at the top 10 currency pairs to trade in 2022.

best forex pairs to trade

You also know of the different factors affecting currency pair prices. We now need to understand the best places to trade these currencies. Also known as ‘Aussie,’ the AUD/USD joins our list of best currency pairs with tight spreads. Like other USD-paired currencies, the AUD/USD currency cross is a proxy for estimating the strength of the Australian economy against that of the US.


The minor currencies are Japanese crosses, Euro crosses and Pound Sterling crosses. We also examine their liquidity, prices, and average spreads on major forex brokerages. We also check their price correction with other currency crosses and assets in the financial markets. If you choose to day trade, one strategy to consider is trend following. This approach is based on the use of technical analysis to identify market trends, so traders can open long or short positions depending on the market’s direction.

Further, their low volatility and respect for technical analysis make them appealing to beginner and intermediate traders. Also known as the ‘Loonie,’ the USD/CAD currency cross ranks high on our index of best pairs to trade in forex. It pits the US dollar against the Canadian dollar, and it, too, is one of the most traded forex pairs. We must also mention that it is negatively correlated to oil because crude oil is one of Canada’s largest foreign exchange-earners. EUR/USD is not only the simplest currency pair to trade but also the steadiest.

It shows how much the USD is worth when estimated against the HKD. The USD/HKD currency pair is viewed as an outlandish one, with a fairly little exchanging volume correlation with the major forex pairs. Even though it is a 24-hour market, 5 days a week, it is usually better to trade currency pairs in your time zone – this is due to liquidity and cheaper pricing again. You as a trader should look for currency pairs that have high liquidity.

The majors are the most commonly traded currency pairs globally. This is the list of the best currency pairs to trade in Forex. You have their pip range which can help you determine when is the best time to trade pairs. The best liquidity, volatility and lowest spread have major currency pairs in the Forex market.

New Zealand and its dollar currency may not be among the world’s biggest, but they have a significant presence in the forex market. “Kiwi” is a nickname for the New Zealand dollar to US dollar currency pair, which is one of the majors. USD/CAD is the market symbol for the US dollar to Canadian dollar rate of exchange. This currency accentforex pair is classified as a “major” since it comprises the US dollar, which is often regarded as the world’s most successful and influential currency. The EUR/USD pair has evolved into the most traded currency pair in the world. The reason behind this relates to the fact that EUR/USD represents the largest two economies globally.

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When you think about it there are over 180 currencies to exchange too. A currency’s value will be influenced by the interest rate disparity that exists between the Reserve Bank of Australia and the Federal Reserve . As a result of Switzerland’s financial secrecy, it has remained a popular destination for holding cash.

With a bit of knowledge and experience, anyone can make money from trading Forex currencies. EUR/USD is reactive to economic news, especially the monthly non-farm payroll announcement on the first Friday of each month. EUR/USD has volatility, but not so much as to create price spikes. Compare this chart with the AUD/USD chart above so you can ascertain what makes a high probability trade setup in Forex and when you shouldn’t trade a currency pair. AUD/USD is an excellent currency to trade because the price action is responsive to price zones, creating patterns of interest for high probability trades.

But, the following five Forex currency pairs are reasonably predictable. When browsing the best currency pairs to trade, aim to find a currency pair with the highest probability. EUR/USD is a popular currency pair for beginners to Forex trading. Recognise the difference between a stable market and an unstable market for trading Forex currency pairs. Tracing historical price action back to 2020, the EUR/GBP is unstable.

GBP/JPY – (Pound Sterling/Japanese Yen)

Even if you are in the Asian or Europe or U.S. trading session you are able to trade this pair with almost the same pip range in each session. The volatility is nice and one of the highest between 12 trading pairs to trade. When traders close their trading positions at the end of the week, they take a U-Turn in the second half of the session. AUD is one of the most traded currencies and has become the 6th best currency for trading in the forex market. British pound sterling , which is accepted in England, Scotland, and Wales, is the official currency of the United Kingdom.

Because of this, the overall interest rate difference that exists between the Bank of England , as well as the Federal Reserve, will influence the relative values of these currencies. GBP/USD is currently one of the greatest technical analysis pairings that can be traded in the forex market. The USD/CAD pair is one of the most fluid and frequently traded in the foreign exchange aetos broker market. The USD/CAD exchange rate is influenced by variables affecting the value of the US dollar and/or Canadian dollar in respect to one another and other currencies. The USD/JPY currency ticker displays the US Dollar versus the Japanese Yen. The Dollar-Yen is the second most traded currency pair, behind EUR/USD, and is a barometer for Asian and worldwide economic health.

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