In this article I will take a look at some of the major currency pairs that you can trade on the forex market. This includes the EURUSD, USD/CHF, GBP/USD, and more.
USD/CHF
A currency pair is a dyadic quotation of the relative value of a currency unit against a unit of another currency in the foreign exchange market. The quotation is written using abbreviations for the currencies prescribed by the International Organization for Standardization (ISO) or the International Organization for Foreign Exchange (IFOE).
Major currency pairs are some of the most actively traded in the forex market. They typically include the US dollar, Japanese yen, and euro. In some cases, traders will include other major pairs such as the British pound and the Australian dollar.
Majors also make up the largest share of the foreign exchange market. Their liquidity is high, their volume is large, and their price volatility is low.
As a result, they are usually the most widely traded in the forex market. USD/CHF is a good example of a major pair.
Its value has been driven by political uncertainty in the United States and the Far East. Switzerland has maintained a relatively stable value because of its safe haven status.
EURUSD
A forex currency pair is an asset that is traded in the foreign exchange market. EURUSD is the world’s most popular Forex pair and is also the most liquid.
The EUR/USD pair is not as volatile as its cousins and it can be a good choice for trading strategies that are short-term in nature. It can be used for scalping, day trading, and swing trading.
There are several factors that influence the value of the EUR/USD pair. One of the most important is monetary policy. This is because the US Federal Reserve and the European Central Bank are the main drivers of the pair. Keeping track of this can help traders make smart trading decisions.
Another factor influencing the value of the EUR/USD is the strength of the dollar. Usually, a stronger dollar means that the euro is weaker. Conversely, a weaker dollar can mean that the euro is stronger.
Other factors that affect the value of the EUR/USD are US and EU economic data. Economic data releases include GDP, consumer price index (CPI), and labor market data. These numbers are useful in predicting the growth of the economy as a whole.
GBP/USD
When it comes to forex, GBP/USD is a major currency pair that has been a popular choice for traders. These two currencies represent different reserve currencies from around the world. However, they can also be quite volatile.
Despite its volatility, the pair offers plenty of opportunities for traders to realize profits. This means that it’s not only one of the most popular currency pairs in the forex market, it’s also one of the most liquid.
One of the main factors influencing the pair is the Bank of England’s monetary policy. They set interest rates, which is based on consumer price index and inflation. If inflation is rising, the Bank of England will raise its interest rate. In turn, it will impact the price of the pound.
Another factor is the UK’s political climate. Political turmoil, such as trade wars, elections, corruption scandals, and more can also cause the forex market to be unstable.
The Bank of England has a wide variety of responsibilities. It is the government’s bank and acts as lender of last resort. A change in the monetary policy of the Bank of England can make a major difference in the GBP/USD exchange rate.
Spread betting
Spread betting is a form of trading in which you make a profit or loss based on the price movement of a particular underlying market. It’s a tax-free investment that allows investors to speculate on the market without owning an asset.
Before you start spread betting, it’s important to understand the risks. In addition, you’ll need to develop an effective risk management strategy. To do this, you’ll need to learn about the markets‘ history, market reactions, and global events.
The bid/ask spread is a difference between the ask and bid price of the two currencies. This is determined by the current supply and demand forces in the underlying market.
Leverage is another key element of spread betting. While it can be used to magnify profits, it can also increase the risk of losing money. You can reduce your risk by using guaranteed stop-loss orders. These orders are available from some brokers, and they will close your position at the exact value you set. Some brokers will charge you a fee for this service.