What Is The Best Currency Pair To Trade

The best currency pair to trade is one that suits your trading style and characteristics that increase the likelihood of your business being profitable. These features include: the pair of liquidity, volatility, interest rate differentials and pip spreads.
Select Pair with heavy volumes of trade exchangesChoose currency pairs that have heavy trading volumes both you are available to trade. While most transactions are speculative and are not entered by the person or company who expect to take delivery of the currency in question, yet a large percent of the traffic occurring on the forex market is a result of regular business transactions and international trade.
It is not uncommon to see significant market movements when local banks started to process customer transactions and so forex trader who trade during normal business hours will capture the major movements market. For example, the USD / CHF and EUR / USD are good for business from 7:30 am EST-1: 00pm and is the EUR / JPY is a good option between 1:00 (EST) and 5 pm 00 EST. Of course, there are some benefits and even greater price movements when the sessions overlap.Deviations Rate Of InterestSome traders may choose a currency pair based on its volatility, while others prefer trader pairs with significant differences in interest rates, so they can earn interest while they wait commerce to reach its profit target. This is known as the carry trade.
Carry traders will buy the currency with the highest interest rate and sell the counter currency that has a lower interest rate. This gives the trading and additional income it will earn on the net of the two countries currency interest rate.
The yen carry trade is often a pair because the Japanese government held interest rates below 1% for more than a decade, the Yen a attractive funding currency. On the other hand, Australia had to maintain relatively high interest rates to combat inflation. This is why the AUD / JPY is a popular carry trade.
The main drawback of the carry trade strategy is that only work when markets are bullish. In addition, it can become expensive to short a carry trade if the opportunity presents itself, because now the merchant must pay interest for as long as he owns the business.
Low of differences from PipThe pip spread is the entry into a trade on a particular pair cost, and therefore the differences directly affect business profits, because you have to cover the cost of mailing before you start making money. In general, it is easier to make money trading currency pairs with low pip spreads. For example, if a pair is a gap of 10pips, the market moves in your favor by 10pips before starting to make money. If the spread is 1pip, each pip move after the first is a benefit to you.
The differences that are attached to a currency pair can vary greatly depending on the forex broker, policies and the spread of international banking network. On the EUR / USD for example, some brokers quote as high discrepancies 10pips and as low as 0.9pips.
In general, the company is made in a currency pair at better spreads the inter-banking network can provide brokers and in turn the best spreads that brokers can give forex traders role , so that the differences themselves can be an indicator of market liquidity.
The EUR / USD has the largest volume of transactions and generally lowest margins of all currency pairs traded today. Here are some reasons why the EUR / USD is the most popular currency pair:

    She has the most liquidity, due to the fact that it represents the two main trading blocs / economies in the world, namely Europe and the United States.
    It usually has the lowest pip spread or entry cost. There is at least one broker, I know who offers the EUR / USD 0.9pips.
The other major currencies are: AUD / USD, GBP / USD, USD / CHF, USD / JPY and USD / CAD. Choosing a forex broker and currency pairs with a good improvement in profitability differences you because those pips can add up.
If you want to learn how to trade like the pros, you need to learn about how the various market factors, including economic, technical data and analysis of the impact on the markets. not just what is the best pair to trade. Having this knowledge will allow you to begin to make good decisions in negotiation. Get this knowledge requires that you get your hands on a great resource negotiation and reading as much as you can so that you can start making money faster.