The Forex market tends to bring out different aspects into consideration. Understanding them and knowing their impacts will help a trader make the right kind of investment. In that manner, if there’s one aspect that you need to be aware of, then it has to be Currency pairs. Touted to be ideal and different in all it’s sense; currency pairs help you get a hold of the market. Since they are also subject to change, one needs to be on the lookout before choosing one. Hence, to help you out, here are some of the major currency pairs trading at the Forex market.
1. EUR/USD
Holding Euro as the base currency and Dollar as the quote currency, this particular combination seems to be the most traded aspect on the market. Individuals know all about the same, and they go through a bunch of risks utilising this combination. This pair is also highly liquid and moves ahead to be less volatile. Thanks to the significance and size of their respective economies, things always seem to head in the right direction. But a small amount of uncertainty due to Brexit and the US-China trade war may be quite visible. With the current outbreak over the coronavirus also coming into effect, traders need to be careful.
2. USD/JPY
Yen and the Dollar tend to share a good rapport with certain kinds of changes coming into the forefront. The value of a single pip is quite larger than a majority of the other currencies, and thus, it tends to be quoted only to two decimal places. Yen’s low relative value also plays a vital role in this matter. These low-interest rates are an attempt by the Bank of Japan that helps them to combat inflation and slow growth. Due to all this, the combination brings into effect the criteria for carry trade, i.e. borrowing money from a country that has a low-interest rate and then moving ahead to invest that in a country that has high rates.
3. GBP/USD
This is another combination that gets formalised with the Pound being the base currency and Dollar being the quote currency. This moves ahead to show how many dollars you would need to spend so that you can buy on Pound. Since it is also connected to the deep-sea cables that used to transfer price information between London and New York, the combination is also called “cable”. Individuals with adequate knowledge about the market can smoothly proceed with this pair, keeping in mind the current states of affairs.
4. USD/CHF
The unique pair of Swiss franc and Dollar did not make sense at the start, but through time people soon began to realise its importance. This particular need arises during uncertainties since Switzerland’s economy is a safe bet. The factor of low risk also plays a crucial role in helping investors go through a safer option. Thanks to its reputation for financial stability, banking it against the Dollar is an ideal choice.
