Forex major currency pairs tend to have a low volatility compared to the other pairs and have more predictable trends. These characteristics make these currencies attractive to beginners who want to learn more about the Forex market. Furthermore, major pairs are widely traded and have tight spreads, making them easy to trade and profit from. However, they do come with their own set of risks.
The EUR/USD pair is one of the largest currency pairs on the Forex market. It has the highest volume of trading and a relatively low volatility. The price of this pair is influenced by a variety of economic indicators, including the monetary policy of the Bank of England and the labour market figures. It is also affected by price shocks from other nations’ economic releases.
The EUR/USD currency pair is known as the “Euro.” The euro was adopted as a base currency by the European Central Bank in 1999. Economic releases by the US Federal Reserve are a big factor in this pair’s value. When the US dollar strengthens, the euro’s value falls. By using EUR/USD, you can make money through Forex trading.
If you’re a beginner to the Forex market, it’s a good idea to stick with the major currency pairs. You can also trade in exotic pairs, but they are less popular. These pairs usually consist of two major currencies and one rare currency from an emerging or developing country. They are less popular than major currency pairs and have higher volatility than major currency pairs.
Another popular currency pair is the USD/CAD. This currency is also known as the ‘loonie’ and accounts for 4.4% of forex trades each day in 2019. Canadian dollar prices are affected by oil prices, so it is wise to keep an eye on them. It is a relatively stable currency, though volatile. A steady rise in oil prices will likely cause the Canadian dollar to strengthen. Traders should follow these trends closely.
If you’re not interested in investing in major currency pairs, you can always trade in cross currency pairs. Cross currency pairs aren’t made up of USD or Euro but include Japanese yen and Euro. However, it’s recommended to trade during the daytime hours to minimize risks. When trading between European and American markets, it’s best to avoid trading during the period between 1 pm and 4 pm GMT.
There are hundreds of forex pairs in the market. These pairs can be traded via spread bets and cfds. However, they’re less liquid than major currency pairs. These pairs are also more volatile, with wide spreads. Furthermore, they’re not widely traded by most investors and forex traders.
The US dollar is traded against the Canadian dollar (the Loonie), the Australian dollar (the Aussie), and the New Zealand dollar (the Kiwi). All three of these pairs include the US dollar, making it an attractive pair for traders. All three currencies have strong economies. The US dollar is the reserve currency of the world.