When looking at currency pairs as a beginner to the forex market, there are a few things that you need to consider. Remember: each currency pair is essentially the economy of a country. This means that managing a currency pair can be extraordinarily complex, because you’re really dealing with two major economies and their relationship with each other. For beginners, the most important aspects of a currency is generally stability and liquidity. You want to find a currency pair that fluctuates fairly predictably but isn’t incredibly volatile, and one that has high enough liquidity that it’s not going to be difficult to trade or have particularly expensive spreads.
With that in mind, here are the five best currency pairs for beginners best currency pairs scalping forex.
Many trading strategies have been developed and fine-tuned with the EUR/USD pair specifically in mind. It makes sense: the Euro and the Dollar are the two largest currencies in the world, and thus it has very high liquidity as well as stability. EUR/USD is such a popular currency pair that it has very low bid/ask spreads and there are always available units for even very large trades — moreover, the trading market is very unlikely to shift or influence the currency pair, making it easier to create analysis and strategies that will benefit the trader.
That being said, it’s usually not a good idea to initiate too many trades with USD in the pair at once; this is a common beginner’s mistake that can take them out of the game if the price of USD sharply rises or quickly falls. The dollar is the most traded currency in the world, and though it would seem that it would create stability, other currencies do range significantly in relation to their value to the dollar.
Two global powers, the United States and Japan create a good pair for those seeking profit.
USD/JPY is extremely liquid. Often called the Gopher, it is the second most commonly traded pair on the foreign exchange market. USD/JPY is one of the better trading tools for beginners that either want to dive in fast or learn about volatility; it’s not advisable to sink a lot of money into USD/JPY until you’ve gotten a feel for its swings and behavior.
USD/JPY is one of the currency trades that is most often impacted by political issues; JPY tends to swing up or down fairly sharply in comparison to the relatively stable USD. That being said, the patterns that JPY creates are fairly predictable, based on both time and season, so many traders can make quite a lot by learning more about its temperament.
The Japanese currency (Yen) is highly dependent on many global factors, such as the import of oil. Thus, an experienced trader will often be able to strategize regarding the market and commodity prices. Japan is also often uniquely hit by natural disasters and political issues; at these times, conscientious traders may need to get out of the market, as the currency can become quite volatile.
The Yen also tends to be either boosted or dragged down relative to the rest of Asia; for instance, China and Korea may both have a substantial impact on the trading activity and volatility of JPY. This is because JPY is often seen as a doorway to the east. Those who do trade USD/JPY may want to keep current on Japan’s political and financial issues directly.
GBP/USD trades on one of the largest markets in the world; the British pound. GBP/USD tends to be fairly predictable. Many forex traders are known to use support and resistance level trading in order to better understand the market with this currency pair.
GBP/USD maintains an interesting relationship with EUR/USD; specifically, it tends to mirror it. The Euro and the British pound both perform virtually identically, so traders may either want to use GBP/USD to hedge EUR/USD or may not want to involve themselves with trading both currency pairs at all.
Trading GBP/USD and EUR/USD in the same direction will often be fruitless; they will almost always operate in tandem without any specific advantage to either. GBP/USD can still be a very interesting trading pair — though it is best left to experienced investors when looking to trade both the GBP/USD and EUR/USD simultaneously.
USD/CAD remains a good pair for the beginner because it is generally very stable.
Due to the close geographical proximity of the USD and CAD markets, the currencies don’t tend to diverge very often — but they still do which creates opportunities for profit. As a relatively strong economy, the Canadian Dollar tends to be primarily influenced by political events; thus, a trader getting into USD/CAD may want to educate themselves regarding any issues that could potentially arise.
AUD/USD — the Aussie — has occasionally become the third most popular currency.
Australia’s economy has been doing very well for some time, and that has driven a significant amount of growth within the country. The currency has reflected this by making marked and predictable gains against many other currencies, though there are also some significant shortfalls and financial collapses.
WHAT ARE THE BEST CURRENCY PAIRS TO TRADE?
With so many Forex Pairs to chose from its important to pick the right pairs you want to focus on.
Every currency pair has qualities. Find out what those qualities are. Trading USDJPY
Much has been about the suitability of technical analysis for trading in the currency forex markets. While this is true, it can leave forex traders, particularly those new to the currency markets. Impression that all technical tools are equally applicable to all major currency pairs.
Why FxPremiere Group uses Forex Signals scalping strategies majors as the best currency pairs!eur usd gbp usd and all are suitable for all investors.
The next most actively traded currency pair is USD/JPY,eur usd gbp usd buy or sell. which accounted for 19 percent of daily global volume in the 2008 survey of currency market turnover. USD/JPY has traditionally been the most politically sensitive currency pair, with successive U.S. governments using the exchange rate as a lever in trade negotiations with Japan. FxPremiere Group sends out Daily Forex Signals for major currency pairs globally with signals sent being short term signals.
Look At Some Il-liquid Currency pairs
To summarize, start with a pair that you can best familiarize yourself with, learn it’s patterns, and give your forex trading career the best chance of taking off.
Extra reading: How to Find a Reliable Forex Broker[/vc_column_text][/vc_column][/vc_row]