Which pairs to trade ?

A huge number of currency pairs are available for trading on the forex market. Most often, traders open positions in the well-known EURUSD and GBPUSD. But besides them, a large number of other currencies and metals are also available for trading. So which currency pairs are best to trade on forex, and which instruments should be excluded from your portfolio ?

Let us begin with the fact that there are 3 groups of currency pairs:

The major currency pairs are the pairs that include the US dollar and the currencies of the most significant countries (groups of countries). Here they are:

EUR/USD – Euro/US Dollar
GBP/USD – British Pound/US Dollar
AUD/USD – Australian Dollar/US Dollar
NZD/USD – New Zealand Dollar/US Dollar
USD/JPY – US Dollar/Japanese Yen
USD/CHF – US Dollar/Swiss Franc
USD/CAD – US Dollar/Canadian Dollar

Of the above, all pairs can quite well be used in trading except USDCAD. USDCAD is not very well predicted with the help of technical analysis and is suitable perhaps only for night scalping. For example, by the same Forex Shocker.  Also, for beginners I advise not to trade USDCHF and USDJPY. USDCHF is distinguished by weak stability of movements, while USDJPY requires somewhat more careful analysis than other "majors" and quite often throws out unexpected tricks, like a central bank intervention.

Cross rates are pairs in which the US dollar is absent. As a rule, they are less active than the majors.

AUD/CAD – Australian Dollar/Canadian Dollar
AUD/CHF – Australian Dollar/Swiss Franc
AUD/JPY – Australian Dollar/Japanese Yen
AUD/NZD – Australian Dollar/New Zealand Dollar
CAD/JPY – Canadian Dollar/Japanese Yen
CHF/JPY – Swiss Franc/Japanese Yen
EUR/AUD – Euro/Australian Dollar
EUR/CAD – Euro/Canadian Dollar
EUR/CHF – Euro/Swiss Franc
EUR/GBP – Euro/British Pound
EUR/JPY – Euro/Japanese Yen
EUR/NZD – Euro/New Zealand Dollar
GBP/AUD – British Pound/Australian Dollar
GBP/CHF – British Pound/Swiss Franc
GBP/JPY – British Pound/Japanese Yen
NZD/JPY – New Zealand Dollar/Japanese Yen

Of course, not all of these cross rates are worth using in trading. For classic trend trading from this list, the pairs with the yen are the most preferable, with the exception of CAD/JPY and CHF/JPY.
Namely: AUD/JPY, EUR/JPY, GBP/JPY and NZD/JPY. However, I do not recommend these pairs to beginning traders, for the same reason as USDJPY - many surprises, and without substantial experience in technical forecasting it is not worth climbing into these currencies.

Exotics include intersections of the currencies of insignificant countries with the US dollar and with each other. There are very many of them, such as USD/RUB, USD/MXN, EUR/DDK and other nonsense.

Exotic pairs have a high spread, they are illiquid and are distinguished by weakly predictable movements. Only especially stubborn patriots and a few drug addicts trade them. I.e., for an ordinary trader there is no point in using exotic pairs - it is a pointless waste of time and margin.

Gold and silver rates do not belong to currency pairs, therefore they are usually singled out into a separate group.

XAU/USD – Gold/US Dollar
XAG/USD – Silver/US Dollar
XAGEUR - Silver/Euro
XAUEUR - Gold/Euro

Of the above, I trade only XAU/USD. Crosses with the euro are less liquid, and I generally try to avoid silver because of the high cost of 1 point of price movement, - it is inconvenient to calculate risks when trading many instruments in one account.

Where can all these instruments be found? The pairs and metals available for trading can be seen in the "Market Watch" window (in the upper left corner of the terminal).

By default, not all instruments are presented in this window. To add or remove something, right-click in "Market Watch" -> Symbols. Also, you can choose "Show all symbols" and "Hide all symbols" - the names of the options speak for themselves.

After you have formed the list of instruments you need, it can be saved. Again, right-click in the "Market Watch" window ->Symbol Set->Save as . And if suddenly your set of currencies gets messed up by accident, you can easily restore it by simply loading the saved set.

Let us sum it up. So which pairs are best to trade on forex?

For a beginner :

EUR/USD, GBP/USD, AUD/USD and NZD/USD

For an advanced trader :

EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/CHF, USD/JPY, EUR/JPY, GBP/JPY, AUD/JPY and XAUUSD (gold).

I want to add that there is no need to spread yourself thin across many pairs right away; many traders generally concentrate on only one instrument and at the same time earn quite well. Specialization has not been canceled. And when trading many currencies at the same time, you devote less attention to each individual chart and may well miss some important detail in the analysis. However, when using a portfolio of currencies, you can get a smoother yield curve due to the larger number of trades.

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Respectfully, Pavel Vlasov TradeLikeaPro.ru