Currency pairs.
The effectiveness of trading directly depends on the correctly chosen trading instrument, but in addition, you need to take into account that each currency pair has its own characteristics that you should pay attention to. The section “Currency pairs” is dedicated to the description of these features.
Currency pairs for making money on swap using the Carry trade strategy
Most newcomers to Forex perceive the commission for transferring positions to the next day only as an additional expense.
But swap can be both negative and positive, using which you can earn money. It all depends on the difference in discount rates between the currencies in the currency pair and the direction of the transaction.
If we recall the principle of swap calculation, we can say that during a purchase transaction you purchase the base currency and take the quoted currency on credit.
That is, in the case when you buy a currency with a higher interest rate and a positive swap value appears.
Currency pair USDMXN, features of trading the Mexican peso
Forex trading is not limited to the five most liquid currency pairs; if you want, you can also make money on exotic assets.
For example, on the same USDMXN pair, which is formed by such currencies as the American dollar and the Mexican peso.
The base currency in this asset is the US dollar, so one lot will be equal to 100,000 US dollars, and the Mexican peso will be used as the quoted currency.
The USDMXN pair has quite high volatility, this is due to the instability of the Mexican peso and the fact that both currencies belong to the same trading session.
Liquid currency pairs on Forex: advantages of trading them
The term “liquid asset” is very often used when it comes to trading in financial markets.
In Forex, it is applied to currency pairs, and characterizes how popular and in demand this pair is among trading participants.
Liquidity in the classical sense is the speed at which you sell your asset at the market price, how in demand it is, how quickly a buyer is found and what it costs you.
Based on this, liquid currency pairs on Forex should be sold at record speed, but in reality everything is a little different.
The speed of order execution in the trader's trading platform is approximately the same, regardless of which pair you have chosen, but the spread commission for opening transactions is significantly different.
Features of trading USDCNH
Your future success directly depends on the choice of a trading instrument, namely a currency pair.
The world's top currencies by turnover are combined into the most popular currency pairs on Forex, which have low commissions and are in huge demand in the foreign exchange market.
Naturally, novice traders try to resort to tools that they have heard of, even if only half-heartedly.
Of course, it is not for nothing that these assets became leaders, but this does not mean that they are the ones that are easy to analyze and the easiest to trade.
Unfortunately, the huge demand for major instruments gives rise to many influencing factors, which makes these instruments difficult to predict.
USDHKD pair. Trading Features
It is no secret that among traders all currency pairs are usually divided into main ones, crosses and outright exotic ones. The main currency pairs on Forex are the most popular on the world market, so it is on them that we can observe enormous liquidity.
As a rule, traders prefer to work with them due to their high volatility and sometimes with cross rates in order to hedge risks .
However, you will rarely find recommendations to trade exotic instruments anywhere in a textbook.
But in vain, because exotic currency pairs of the Forex market can also bring good profits, and will be especially interesting to investors who prefer to create low-risk schemes with hedging elements to make a profit from the swap.
Characteristics of EURCAD
Many traders avoid cross rates due to the rather low volatility and high commission set by the broker in the form of a spread.
However, not all currency pairs on Forex, which we traditionally call exotic, have weak liquidity with high commission requirements.
For example, EURCAD combines the interaction of such highly developed countries as Germany, France and other members of the European Union with the equally developed Canada and its developed industrial complex.
The economic relations of the developed European Union with industrialized Canada generate increased interest in this currency pair, and therefore the volatility and size of the spread for this cross rate are practically in no way inferior to the most popular assets.
Currency pair GBPAUD
The choice of the Forex currency pair with which a trader will work directly determines his performance.
The subtleties of the movement of the instrument, the factors that influence both currencies separately and what the exchange rate is based on, is the basis for making the right trading decisions.
GBPAUD is a trading instrument that combines two national currencies, the British pound and the Australian dollar.
To understand the mechanism of plotting a chart, when you see this symbol, you must clearly understand that the chart displays the number of Australian dollars that must be paid for 1 British pound.
Both of these currencies are slightly inferior in terms of money supply turnover to such giants as the dollar and the euro, but they confidently occupy the fourth and fifth places in the world in terms of global volume.
Currency pair gold – XAUUSD
Gold is one of the most attractive exchange instruments for investors.
Until recently, gold was considered a quiet investor's tool because it had been actively gaining in price over the years.
However, from the second half of 2012, the instrument began its active downward spiral and turned into one of the most volatile and unpredictable on the Forex currency market.
XAUUSD consists of two elements, namely gold (XAU) and the dollar (USD) for which this precious metal is purchased.
The XAUUSD currency pair is considered to be one of the most dangerous due to the poor predictability of its movement and very high volatility, which reaches from 2500 to 3000 points per day.
Currency pair USDDKK
There is an opinion that in recent years the volatility of the main currency pairs on Forex has decreased radically.
Today, seeing a daily movement of 250 points in the euro/dollar is very rare, and, as a rule, caused by a strong news storm, which makes such jumps very unpredictable.
As you understand, a decrease in volatility and liquidity always leads to a decrease in the profitability of trading strategies.
Of course, you can overinflate the lot and achieve very high results by overestimating risks, but you can also go by using exotic currency pairs in your trading arsenal.
The USDDKK currency pair is one of the most popular exotic currency pairs, whose daily volatility can exceed 1,500 points.
On days of calm and a strong calm market, the price for this instrument manages to move 300-500 points, which allows the trader to use the same trend trading strategy as for the main market instruments to obtain increased profitability.
USDDKK is an asset that is formed by the American dollar and the Danish krone.
Dollar currency pairs and trading them.
Any asset has its own characteristics and behavior, so before you start trading using
any trading strategy, you should calculate three times whether your tactics are suitable for possible price changes, volatility, and chart behavior in different trading sessions.
Before starting a review of various dollar instruments, I would like to recall the three main groups of quotes in relation to the dollar, namely direct, reverse, and cross rates.
A typical example of a direct quote is USD/JPY due to its widespread use, but what do you understand in a direct quote, the USD symbol is always the first, followed by the symbol of another currency.
A direct quote shows how much a certain currency needs to be given for one dollar.
In a reverse quote, the USD symbol is located after another currency, for example GBP/USD, and shows us how many dollars we need to pay for 1 unit of currency, and in our case, for 1 pound.
USDSGD
Choosing easily predictable trading tools is the shortest path to success.
Many people have been working with the euro/dollar for years and cannot learn how to make any meaningful forecasts, let alone actually make money.
The banality and stupidity of the situation is that the vast majority do not even try to get acquainted with other possibilities, and when exotic instruments are mentioned, they themselves build a wall of rumors and speculation.
Self-doubt and a bunch of myths that it is more difficult to work on exotic currency pairs because they are unpredictable deprives you of a second chance to master the profession of a trader.
In today's article we will talk about the so-called exotic currency pair USDSGD. It consists of two currencies, namely the American dollar (USD) and the Singapore dollar (SGD).
NZD/USD
NZD/USD is considered the most attractive instrument for investors and traders who prefer long-term trading.
The pair includes the two most common currency pairs New Zealand dollar and US dollar.
If the US dollar is the first world currency, then the New Zealander is among the top ten currencies occupying global financial circulation.
NZD/USD is characterized by long trends and relatively low volatility, therefore, due to its predictability, almost all beginners are recommended to start with it.
I propose to familiarize yourself with each of the currencies in more detail in order to add up the common factors that influence the movement of the NZD/USD chart.
CADJPY
CADJPY is one of the most favorite trading tools of traders who actively know how to apply fundamental analysis .
Due to its peculiarity, CADJPY is considered the most poorly predictable tool for traders who use technical analysis.
Sudden jumps of 150-250 points per day are considered the norm for this instrument, since it reacts strongly to economic indicators, foreign political activities of states, as well as the release of key news from strategic partner states.
CADJPY belongs to exotic currency pairs, since due to the high commission when trading this instrument, traders who trade short positions, as well as various kinds of scalpers and pipsers, are simply eliminated.
On average, the spread ranges from 7 to 15 points for various brokers, so if you decide to work with CADJPY, I recommend that you more carefully select the company with which you will trade in the future.
EURCHF
The EURCHF currency pair consists of two monetary units, namely the Swiss franc and the euro,
which is the main currency of the European Union countries.
If you look at the configuration of the currency pair, you can conclude that on the chart we see how many Swiss francs are worth one euro.
Until recently, EURCHF was considered one of the calmest assets, since during the day it crossed only 20-50 points per day, and sometimes did not exceed the mark of up to ten points.
Therefore, this instrument was not particularly popular among speculators, since, in fact, very low volatility and small price movements during the day simply did not allow traders to make money.
EURGBP
The EURGBP currency pair consists of two monetary units, namely the euro and the British pound.
with
EURGBP, the main of which is that it has calm trends without any sharp jumps.
Some site owners recommend it for beginners, claiming that it is easily predictable and does not have high volatility.
All these are myths and misconceptions, and I will try to explain to you why.
Initially, let's look at both currencies separately so that we can understand what actually affects the price movement.
USDZAR
The USDZAR currency pair belongs to the category of exotic trading instruments on Forex, so
traders rarely use it in their trading.
The disadvantage of working with exotic instruments is the presence of a large spread, and if we talk about USDZAR, its value usually ranges from 15 to 30 points depending on the broker on four-digit quotes.
USDZAR consists of two independent currencies, namely the American dollar and the South African rand.
Moreover, judging by the configuration, we buy dollars for rands, and not vice versa as is the case with major currency pairs.
Volatile currency pairs
One of the indicators on the value of which the profitability of transactions depends is Volatility.
The indicator characterizes the distance between the minimum and maximum price values per day or trading session.
Volatile currency pairs in Forex allow you to earn the maximum number of pips per trade, thereby reducing the size of the tight spread.
You can get a good profit even from one transaction, and this allows you to use even pairs with a wide spread in trading.
Those traders who trade on medium-term time frames should pay attention to this indicator; when using scalping or pipsing, it does not play a special role.
At the moment, the greatest range of movement is observed for the following exchange assets:
AUDCHF
AUDCHF consists of two currencies, namely the Australian dollar and the Swiss franc.
This instrument has an order of
magnitude lower liquidity than such popular instruments as pound/dollar and euro/dollar.
The main disadvantage of working here is that almost all brokers place a large spread on it, which makes trading simply unprofitable for scalpers and traders who prefer to trade short positions.
For example, the InstaForex broker set a spread of 10 points, and as you understand, seeing a negative balance immediately after opening a position, and even a spread of 10 points carries a large psychological load.
Before we talk about forecasting the exchange rate for this instrument, let's look at each of the currencies separately.
Currency pair USDNOK on Forex
Until recently, it was believed that USDNOK belonged to the second group of traders’ interest after such instruments as pound/dollar and
euro/dollar.
This was due to the fact that USDNOK had low liquidity, unlike the above listed currency pairs, so it was no longer traders who were interested in it, but investors.
USDNOK is made up of two currencies, namely the American dollar and the Norwegian krone .
If we talk about the dollar, then almost all of us know what factors influence its movement, but few of you have thought about what makes the price of the Norwegian krone move.
Norway is a country that ranks fifth in the production and export of black gold.
Oil is the basis of the economy for this country, and the ability to supply raw materials to different countries has always greatly filled the state budget.
The most profitable currency pair
There are a great many discussions on the topic - “What can you earn the most money on?”, any novice trader asks the question 
-
What currency pairs are the most profitable in Forex?
The question is quite interesting and requires careful study, because any of the trading tools can provide high profitability at certain moments.
Let's look at the current situation regarding the most popular instruments, and we should pay attention not only to the foreign exchange market.
The trading platform allows you to use almost any exchange assets, including futures and precious metals.
Cross pairs on Forex
The main instrument on the currency exchange is still the American dollar; it is the second currency in
most transactions. Such currency pairs on Forex are called direct and, as a rule, have the smallest spread.
But the US dollar is not always involved in the transaction, for example, you want to buy euros for Swiss francs EUR/CHF, in this case the quote will no longer be direct.
This entry is called a cross pair; in fact, these are all transactions without the participation of the American dollar.
That is, such pairs include AUDCAD, AUDCHF, AUDJPY, AUDNZD, CADCHF, CADJPY, CHFJPY, EURAUD, EURCAD, EURCHF, EURCZK, EURGBP, EURHUF, EURJPY, EURNOK, EURNZD, EURPLN, EURSEK, GBPAUD, GBPCAD, GBPCHF, GBPCZK , GBPJPY, GBPNOK, GBPNZD, GBPSEK, GBPZAR, NZDCHF, NZDJPY, etc.
Currency pair for a beginner
A beginner who decides to trade Forex first of all faces the question of choosing a trading asset; usually brokers
provide about several dozen currency pairs, so which one should you choose for profitable trading?
It would seem to be the most popular, but the answer is not always so obvious and many experts advise not to approach this matter so formally.
Yes, EUR/USD has the most favorable trading conditions; in addition, a huge number of tools such as advisors and indicators have been written for this currency pair, but along with its advantages, it also has certain disadvantages.
First of all, news on the euro comes out during business hours in Moscow, which causes sharp fluctuations in the exchange rate while you are working on Forex; in addition, the asset is influenced by a lot of minor factors, so it is difficult to objectively assess the price behavior.
Pair CHFJPY
Most traders prefer to trade only the most popular currency pairs on Forex, while other, no less interesting,
trading tools are ignored.
The CHFJPY pair falls into this category; it consists of the base currency of the Swiss franc, and the Japanese yen is the quote currency.
A rather interesting combination allows for profitable trading during the Asian Forex session, since it is at this moment that the price is more susceptible to change.
That is, the instrument is more suitable for traders who prefer to work at night or in the morning; this state of affairs is due to the fact that the main events in the yen occur during the Asian session, while the Swiss franc is a more stable currency.
How to choose a currency pair
As in any Forex market, a lot depends on the choice of trading instrument, and unlike real trading, a lot of other indicators are taken into account here, and not just supply and demand.
The approach to selection should also take into account the trading strategy itself that the trader has chosen, and not just the characteristics of the trading instrument.
It is taking into account the Forex strategy that allows you to choose the right pair that gives the maximum chance of success in stock trading.
In addition, many advisors are created for a specific exchange asset; this is also important when making the right choice.
USDCNH pair
The Chinese currency is increasingly gaining ground on world markets, and this phenomenon has not spared Forex trading.
Gradually,
the Chinese yuan began to appear in traders’ terminals.
USDCNH is the main currency pair with which you can trade Chinese currency; at the moment it is the most liquid trading instrument involving the yuan.
What is attractive about such trade?
• Prospects - China ranks second in the world in terms of economic indicators, which means the popularity of its currency is growing.
Trading silver on Forex
At one time, silver was considered one of the leaders in exchange trading; this metal was actively sold and bought on
most of the world's exchanges.
Trading silver at the moment has also not lost its attractiveness, especially since it can be carried out by almost anyone who has the necessary amount to start trading.
The technical instrument with which trading is the XAG/USD or XAG/EUR currency pair.
In the first case, silver is bought for American dollars, in the second for euros, the choice of instrument depends on which currency you are more familiar with and which one is more convenient for you to work with.
Oil on Forex
It would seem that an error has crept into the title of the article, because Forex is a foreign exchange market, accordingly,
only currencies can be traded on it.
But the well-known metatrader trading terminal allows you to perform operations not only on the foreign exchange market, so assets such as gas, oil or precious metals can also become trading tools.
Oil on Forex can be bought or sold just like any currency; technically, this operation is no different from trading currency pairs, but there are still some differences.
• Oil quote - displays the price for 1 barrel, that is, how many dollars will need to be paid for 1 barrel of oil, currently the price is around $100.
Currency pairs with small spreads
The size of the spread on currency pairs on Forex is important when using large leverage; the difference in a fraction of a point can grow into a significant amount
, and if a trader enters into a large number of transactions, then this amount increases in proportion to their number.
This is why it is so important to choose a currency pair with the smallest spread.
Typically, such pairs include those that include the European currency or the American dollar; small spreads can also be found on other trading instruments.
It should also be noted that the size of the floating spread can change dynamically depending on the liquidity of the asset in the market.
Depending on various factors, liquidity for the same asset may fall or rise.
EURUSD
The most popular Forex trading instrument is EUR USD; the number of transactions made between these
two currencies exceeds 60% of all Forex transactions.
And this is not surprising, because the pair is formed by the two most popular currencies - the American dollar and the euro; it is on these monetary units that you can find a lot of useful information, from news to analytics and exchange rate forecasts.
EURUSD is a rather interesting instrument with its own trading features, which we will discuss below.
Structure and general points.
In EURUSD, the euro is the base currency, and the dollar is the quoted currency, so its price rises along with the rise in the euro exchange rate and, on the contrary, falls when it decreases. If the US dollar strengthens, we see the opposite picture.
EURRUB pair
EURRUB is quite unusual, but still a popular tool for working on Forex; more and more brokers are including it in their
trading terminals.
EURRUB - consists of the base monetary unit of the euro and the quoted ruble, that is, the price of the currency pair is directly linked to the euro exchange rate; if the euro goes up in price, the pair will also go up and vice versa.
There is an inverse relationship with the ruble exchange rate: the ruble becomes more expensive, the price of the currency pair falls, and accordingly, if the ruble exchange rate for EURRUB falls, an upward trend will appear again.
Despite some exoticism, ruble currency pairs on Forex are increasingly becoming popular, because you can follow the news almost in one Forex session.
Trading gold on Forex.
Despite its belonging to precious metals, gold is also the subject of active speculation on Forex.
Gold trading on Forex is carried out in the trader’s terminal using the XAUUSD currency pair and is technically no different from working with other instruments.
You also place urgent and pending orders and can use any available technical analysis tools .
The XAUUSD currency pair consists of two assets, the base of which is, of course, gold, and the quoted one is the American dollar. That is, you will trade gold for US dollars, regardless of the currency of your deposit. You can also use the XAUEUR currency pair for trading; this option is suitable if you work during the European trading session and use current news in your work.
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