Financial Trading: Forex Pairs Review

EUR /USD Forex pairs are also known as currency pairs. This form of trading indicates how many U.S. dollars (quote currency) are required to purchase one euro (base currency).
Trading with EUR/USD currency pair is also called trading in euro. The value is usually quoted as one euro per x U. S. D. For instance, if a pair is trading at the rate of 1.5,then it means 1.5 U. S. D is required to buy one euro. EUR/USD are the most sought-after trading pairs in the world. This is mainly because they are the are used in the two largest economies. As major events occur, the pair fluctuates. They can rise and fall within the twinkle of an eye when major actions occur within the United States and Europe. USD/JPY This is a pair between the U.S.D and the Japanese Yen. It is also a popular pair currency among traders. Most people consider it a better option because what will happen between these two can easily be determined by watching the News headlines. In the event that the Japanese make a decision that affects their economy drastically, a shift occurs in the GBP/USD forex pair. GBP/USD This is a pair between U.S.D and Great Britain Pound. Over the years, so many traders have invested heavily in this form of trading. The pair is often referred to as the cable which connects and holds the United States and the Great Britain economy together. Some traders use this pair in along with the EUR/USD trading as a result of their similar patterns. AUD/USD This pair involves the United States Dollar and the Australian Dollar. This form of trading stole the heart of traders following the boom in Australian commodities that led to some extreme highs. Traders who got involved made a lot of money during this period. Changes in the Chinese economy can potentially have a dire effect on the AND. USD/CHF This pair involves the United States Dollars and the Swiss Franc. This pair is usually the first choice for traders who love to invest in short term trades. All traders know that the European economy News can serve as a major indicator in USD/CHF. USD/CAD Most traders who love neighborly Forex pair trade with the United States and Canadian Dollar. The currencies fluctuate often when oil and other market commodity prices fluctuate. Traders tend to keep an eye on the friction between the U.S. stocks and the Canadian stock as they reflect the changes. EUR/GBP This is a pair between Euro and Great Britain Pound. It may seem similar to the U.S. and Canada pair, but it is considered as less volatile. Changes occur in this market when changes are made in monetary policies between the Bank of England and the Central European Bank. Advantages of Forex pair Relatively low cost There are no real commissions and brokerages in this market. Brokers gain from the spreads between Forex currencies. Traders do not need to worry about making room for separate brokerage charges or eliminating overhead. Flexibility Forex pair can accommodate different trading styles and run 24/7. Traders can engage at their convenience. This is beneficial for those who are interested in short-term trading. Trade can be carried out at off-hours. Offers very high liquidity When you compare Forex trading to others, you'll find that it has the greatest number of participants. Large orders of trades(currency) are filled effectively with minimal price variations. This is as a result of its high liquidity. The chances of price manipulation or anomalies are relatively low. No central exchange The fact that it is an over the counter market that operates globally makes a central exchange rate or regulator for Forex market absent. Disadvantages of Forex pair training Lack of transparency As a result of the deregulated nature of the market, there is a lack of transparency. Traders trade against experts who dominate the market. There may be little or no control over when the trade order gets fulfilled. As a result, a trader may not get the best price or may get limited views on quotes. Complex Price Determination Process The rates are influenced by a number of factors, basically global politics or economics. This may make an analysis of information difficult. It may also be difficult to draw a reliable conclusion. High Risk, High Leverage This form of trading is only available on higher leverage. This implies that a trader cannot lose/profit exposure several times off the trading capital. Self-directed A forest trader is strictly alone. They have little or no assistance from professionals. A trader must be dedicated to disciplined and continuous learning. Beginners find it difficult to do well because of insufficient knowledge that leads to improper trading.