Best Currency Pairs

Price:

A currency pair consists of two forex currencies involved in the trade. Example of currency pairs are EUR/USD, USD/JPY, USD/CAD etc. So which is the best currency pair for forex trading? There are mainly two factors that you should to take into account when considering the best currency pairs for trading. These factors are activity and the forex trading systems. First let’s see the activity part.

1. Which are the Most Active Currency Pairs?

One of the best ways to begin forex trading is by choosing the most active currency pairs. Most experts will suggest you to do so due to a number of reasons. The first reason is that active currency pairs have high liquidity and this means that your stops will more often be met without slippage. Next, in case of currency pairs which are very active in the market, the costs are likely to be low. When large number of traders are trading in the forex market it creates a tighter spread, and there is also heavy competition between forex brokers which will in turn keep the fees down.

So does this mean we just have to look into the most active forex market and choose the currency pair? Not really. If you are new to currency trading you may be surprised to learn that the most active trading floor is London, UK and not New York. However the most traded currency globally is of course US dollar. So naturally now you must be thinking that US Dollar, GBP (British Pound) pair is the most traded currency pair in the foreign exchange market. This is not true. In fact EUR/USD currency pair is the most traded forex pair. The next most active currency pair is USD/JPY and the third is GBP/USD pair.
This is due to the fact that forex market is global and traders around the world are free to choose their own currency pairs.

2. Best Currency Pairs for Your Forex Trading System

The most prominent factor in choosing the currency pair is of course the activity level and your knowledge about the economic conditions of a particular foreign exchange. Your forex system also could be a factor in selecting the currency pair. You might have the best forex trading system, but if chose a wrong currency pair you could end up with poor results.

For example if your forex trading system involves the use of automated forex robot, you will most likely find that the particular forex trading robot is set to work with a small number of currency pairs and that the most active currency pair might always gives you the best results. For instance, you may know that FAP Turbo which the best forex software currently in the market is designed to trade EUR/GBP and EUR/CHF currency pairs. In case of FAP turbo most users observed that they are able to achieve better results with EUR/CHF pair though EUR/GBP more active pair when compared to Euro/Swiss Franc currency pair. Thought you can trade different currency pairs with a robot, a particular forex ea is always tend to give better results with a particular currency pair.
Hence in such cases you should choose a currency pair which is suitable to your trading system even if it is not the most active currency pair. There is a new forex software called Ivybot which provides you 4 different currency trading in which each are designed to work well for a specific currency par. You can see the Ivybot review here.

The bottom line is that unless your forex trading system is set to give better results with a particular currency pair it is always best to go for the most active currency pairs in the market. This is especially true if you are developing your own forex trading system which involves scalping. That is; if you are a beginner at forex, EUR/USD is the best currency pair for scalping.

Visit Website Now

One Response to “Best Currency Pairs”

  1. Forex Robot says:

    The most prominent factor in choosing the currency pair is of course the activity level and your knowledge about the economic conditions of a particular foreign exchange. Your forex system also could be a factor in selecting the currency pair. You might have the best forex trading system, but if chose a wrong currency pair you could end up with poor results.