The Best Currency Pairs to Trade in 2022 currency pair priority

It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. The pairing of the euro and the British pound in the EUR/GBP pair is often seen as one of the most difficult pairs to make accurate price predictions for.

  1. We predicted that the price of GBP/USD would bounce between $1.40 and $1.38 for the remainder of 2021.
  2. Well, there are different kind of traders, strategies, indicators or robots that are set to work optimally in such market conditions when the volume is low.
  3. Consequently any person acting on it does so entirely at their own risk.
  4. The EURUSD and the GBPUSD both share a positive correlation as you’ll see in the image below, while the EURGBP and the GBPUSD share a negative correlation.

You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. Please ensure you fully understand the risks involved by reading our full risk warning. The major currency pairs comprise up to 75% of forex volume, which makes them easier to trade than minors and exotic pairs because they have the majority of buyers and sellers. Not surprisingly, all of these pairs contain the US dollar – due to the sheer size of the US economy.

What are the Most Volatile Currency Pairs to Trade?

The Japanese yen (JPY) is the official currency of Japan, and the currency dates back to the Meiji Restoration’s attempt to westernize and modernize the Japanese economy. The yen lost a large amount of its value following the conclusion of World War II but has slowly begun to stabilize after reaching a low following the 1973 oil crisis. The euro is a stable currency that represents the European Union and is the official currency of 19 of the 28 members of the European Union. Such pairings occur because of the strength of the economy plus the power and stability of the government that backs the U.S. dollar.


At the same time, the ebb and flow of global economic sentiment and other UK-specific related uncertainties can sway the pound. The GBP/JPY’s movements are also impacted by economic data releases and political developments in both the UK and Japan, fueling further volatility. Also, these currency pairs aren’t necessarily the easiest pairs to trade.

CPI (inflation) statistics, Nonfarm payrolls (employment data), GDP, retail sales, purchasing managers index (PMI), and others are all important economic indicators that impact currency rates. You can use the economic calendar to track future economic data releases which may affect the forex market. While many traders are drawn to the forex square of nine market for its 24-hour trading, others like it because of its long-term trends and reactions to major support and resistance levels. Position traders often keep positions open for weeks, months, or even years. Furthermore, position trading allows a trader to make a  long-term investment as they are not required to “babysit” their trades.

EUR/USD – (Euro/US Dollar)

CNY is the forex ticker for the Chinese renminbi trading market, but when the yuan is traded offshore, it is referred to as CNH – so on our trading platforms, this pair is listed as USD/CNH. CNH has usually not been as tightly controlled as CNY by the Chinese government, which means it can be more volatile. Because the time of day heavily influences how liquid a market is, and how much price movement it’s likely to see.

This guide will discuss the best Forex pairs to trade for beginners and intermediate Forex traders. A currency pair is the exchange rate between two different currencies. In forex trading, all currencies are traded in pairs because when you buy one currency, you are simultaneously selling another currency.

But most traders stick to the currency pairs that have the most volume and liquidity – and therefore come with the most volatility. For the most part, the currency pair is used by traders and investors who want to protect their assets in periods of market turbulence and economic downturn. The CHF is largely considered to be a ‘safe-haven’ currency thanks to the stability of the Swiss financial system, which means that it may appreciate when other currencies lose value.

When a major announcement is made regarding economic data—especially when it goes against the predicted forecast—currency can lose or gain value within a matter of seconds. You will develop a second sense of price prediction, which confirms your Forex strategy. This pair is the most widely traded one in the forex market since it represents a combination of the world’s strongest economies – European and American.

68% of retail investor accounts lose money when trading CFDs with this provider. The forex market is also the largest and most liquid market in the world with nearly $7.5 trillion dollars traded each day in 2022. This makes the forex market an ideal place for traders looking for high leverage trading. When it comes to trading forex, there is no single currency pair that can be labeled as the most profitable. Different currency pairs have different levels of volatility and liquidity, meaning that different approaches will be necessary for each one.

On 10th August, the price broke out above the descending channel but has met a previous resistance zone at $88.30 and the 50 EMA (wiggly blue line). As the price fell, it tested support at $85.80 (which was previous resistance). It landed on another support zone which coincided with the 200 EMA (Red wiggly line). There are no potential setups for EUR/GBP  until the price action becomes more stable. The price of AUD/USD went sideways in a range from mid-May to mid-June 2021 when it broke below and made a lower low and lower high.

As a result, while trading the USDCAD, you should keep an eye on the prices of both Brent and WTI crude oil and plan your trades accordingly. The AUDUSD exchange rate is also influenced by interest rate changes from the Reserve Bank of Australia (RBA) and the US Federal Reserve. It can also be affected by gold prices, as Australia is a major producer of gold. A change in those commodity prices on the global market would almost certainly result in a change in the value of the Australian dollar. 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.

However, various factors such as trade relationships, changing interest rates, economic upheaval, and country disputes, including war, can affect individual currencies (and thus pairs). So make sure that you’re up to date on such news and information before leaping into the forex market so you can choose the most viable currency pairs to trade. The world’s largest economy and its northern neighbor the Canadian Dollar (CAD) are next on the list of most popular currency pairs to trade. This pair tends to negatively correlate with the AUD/USD, GBP/USD, and the EUR/USD. Minor forex pairs, or crosses, can include frequently traded currencies such as the Euro, British pound, Japanese yen, and  US dollar. But these currencies are paired with those of smaller economies, such as South Africa and Hong Kong.

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