Every newcomer who comes to forex trading, faced with the choice of currency pairs. As a rule, everybody knows the most common currency pairs For example, the Euro-Dollar, Dollar-Yen, Pound, Dollar, Dollar-Franc. The rest is less well known but, nevertheless, can cause enormous interest among beginner in terms of prospects for trade in these instruments. In addition, some obscure currency pairs, even more specifically suited to beginners due to its peculiarities.
How to choose a currency pair?
definite answer to this question does not exist. This physics can be said that in a kilogram exactly one thousand grams. But what a currency pair to choose a newcomer, it's more like a collection of tips and advice, and sometimes just stories in which everyone will share their experience. In addition, we must remember that the currency pair - it is an individual preference for each trader. Choosing a currency pair will depend on numerous parameters, so everyone will have to decide this question themselves, guided by their tastes and experiences of other traders simultaneously.
C begin select a currency pair?
For each currency pair, there are certain times of greatest activity. For example, the Euro and Pound to U.S. active at a time when the work British European and American economy. Night (Moscow time), these couples give more false signals, since during this time Asian traders operate. Such periods, when the national banks operate a particular currency, call trading sessions.
Trading on the currency pair can be both during the session and after it. When and better, these issues will be resolved after selecting a trading strategy . But more often prefer sell it during the trading session. For example, one of the most popular services for traders providing trading advice for transactions on the currency pair euro-dollar, reports that use the service during the Asian session (night in Moscow) is not recommended due to the large number of false alarms for the opening of the transaction. But if a trader has a strategy to make profits is not in session, then there nothing to argue.
volatility in the currency pair
Just what we were told that foreign exchange pairs differ in the time at which the economy works countries to which they belong. But besides that, there is one very important difference. Currency pairs differ in volatility. Volatility - is the range fluctuations in currency pairs in a given period. Ie each currency pair makes jumps of various sizes. In response to these shocks, some currency couples can be called quiet and calm, and some vice versa.
For example, the currency pair GBP / JPY and GBP / USD are the leaders in sharp fluctuations. Therefore, trade in these currency pairs is recommended only for those who have a trading strategy, designed for such races. Little calmer EUR / CAD, EUR / AUD, even quieter USD / CHF, GBP / CHF, EUR / USD and USD / JPY. On these currency pairs traded a substantial part of Traders. Oh, and leaders of peace and tranquility are the EUR / CHF and EUR / GBP, for which the oscillations around 3-4 times less than in most volatile currencies.
Each currency pair has its own character, its own peculiarities. Some of them can be seen just once glancing at the schedule, and some open only during direct contact, and then sometimes not immediately. In addition, there are currency pairs-allies which often make similar movements. But too much to hope for such an option should not, as might otherwise be a serious loss. For example, the trader gets used, that the Euro and Pound always move together against the dollar. When certain events opens a deal on the pound. Then he thinks: "But the Euro is usually there is going! And opens up a similar deal for Euro (perhaps not the best example, but the essence is not in it). At one point, he discovers that one transaction in the "plus", but an ally summed up, and so the second transaction has brought loss. Therefore, I recommend everyone to be careful with strategies that use the principle of alliance pairs. Though there are traders who can make a profit only here for such processes.
There are some strategies to to trade on different currency pairs simultaneously. Some of them are forced traders to trade on two or three currency pairs, and sometimes there are also such a strategy that the trader trades once in ten or even more pairs. For example, one firm, providing trading signals for forex, gives them right to a dozen currency pairs. Service rather comfortable, decorated in a table, and deals to open as soon as all ten pairs is not necessary. But man, accustomed to working with the Euro-dollar or pound / dollar currency pairs, sometimes comes in for some confusion from such an abundance of trading tools. If desired, you can still explore the previously not tested currency and start working with these tools. The more so because sometimes the transition from one currency pair to another can significantly increase proceeds on deposit since initially many traded on the rather complicated currency pairs, unaware of the benefits available when trading in other currencies.
Often when trading multiple currency pairs using methods of non-simultaneous opening of multiple transactions on different currency pairs, and the methods for selecting most successful option. That is, traders on several pairs, inclined, because of certain trade events, to choose the most appropriate currency and open trade is on it, temporarily forgetting about the others. The next time the currency may already be different.
Trading one currency pair.
first, on that would like to draw attention to is the fact that many in choosing a currency pair is guided by some geographic data. Traders from the CIS more often prefer the Euro-dollar, pound, dollar, dollar-Franco, Dollar-Yen. Much less often choose the less popular, such as the Australian dollar, or Canadian in different variations. But these prejudices do not have a geographic cost-effective basis for choosing them as trading instruments. Therefore the use of obscure and exotic (at first glance) currency pairs is very justified and can lead to good performance in trade. Especially considering that the major currencies is very difficult for beginners.
Correlation trading strategies and currency pair
trading strategies and currency a pair of very closely linked, as a whole constitute a common element - the process of trade. Currency pair can be compared with the food and the strategy of the regime taking this food. If your diet is to eat often and much, then you will be recommended for a meal, and those who eat little and often - is another. Similarly, as is the case, and the opening deals on different currency pairs. Those who commit the transaction is rarely better trade calmer currency pairs, which give weaker oscillations. And for those who want to trade often and much, probably more appropriate aggressive majors who commit average daily fluctuations in the order of 100-150 points. While here, as can always be exceptions. You can make rare deal on volatile currency pairs, for example, trading on long-term periods of a small lot and a little leverage.
Some people food can be called spontaneous. The same thing happens, and Forex. Eating spontaneously people eat the first thing that caught my arm, sometimes biting yet another type of food. Some trading strategies allow using this principle have great strides in trade, so this method of spontaneous betting is very popular. But we want to stipulate several points at once. By spontaneous conclusion of transactions on Forex do not mean that traders are not looking at the schedule opens up a deal on a particular currency pair. No way! By spontaneous committing transactions meant only that there is not much difference between what a currency pair, and the attractiveness of her "eating" depends on the situation analysis which should be very careful and precise.
Another very famous kind of food is messy eating food. But as you know, it is often leads to indigestion and general health. Forex, this example finds a similar reflection. A trader makes a transaction then a single currency pairs, then abruptly switches to the other, sometimes even strangers. If this process occurs at the stage of testing of trading strategies on a demo account, it fully justified process. But among the newcomers there are extremal afford such a mess and the real accounts. As for nutrition, for such actions to pay. Only in the sick role of the stomach and poisoned the body are the deposit and the psychological state of Trader. There is no consensus as in nutrition and the use of trading strategies, and in their choice, to date, does not exist. There are some proven methods, which may slightly tell for or against.
For some pair of profitable trade?
profitable of all trade for the currency pair, whose movements Trader predicts best. Those who do not have trading experience, you should decide at the beginning of the trading strategy, and depending on her to pick a currency pair or even a few pairs. Of course, it is necessary to take into account the volatility and the trading session. Some traders on several currency pairs, resulting in numerous trade get some statistics. The analysis of these data obtained by a certain picture of the success of trade in certain currency pair. And Trader proudly beats his chest and says newcomers: "You Do not go, and then the" loss "(loss) of the deposit will get, savsema bad happens." Actually "Loss" (loss), each has its own, as well as the reasons for their generators. Therefore, the success of one - is not as significant indicators. Greater weight to have the same statistical data, but collected a large number of traders. With them we will now take a look.
Brief characteristics of some currency pairs
To help beginners, we have compiled a survey of some currency pairs. But remember that some opinions may be outdated, and some may not be the same with the views of others. Therefore, this review is very conditional.
EUR / USD (Euro-Dollar)
Certainly, this currency pair is today the most popular. But, despite its high popularity among currency speculators, the Euro-dollar bears in their movements sea of \u200b\u200bdisappointments and losses. Only at first glance, the motion this financial instrument seem very simple and predictable. But due to the large number of professional players currency pair at times behaves very unpredictably and "devour" deposits of many traders. Despite fairly large fluctuations (due to the fact that many major players may open positions in different directions), for this currency pair is best to follow the trend and bring Scalping less success (guidelines for choosing the direction trading strategies).
For beginners Euro-dollar is not the best option, although there are cases where newcomers could tame this currency pair. Forecasts Euro-dollar from various financial institutions rather imprecise and unpredictable.
USD / JPY (dollar-yen)
second volume of transactions in the Forex market. Many called Dollar Yen most insidious of currency pairs. Pipsovat in this market is virtually useless, as even the most quiet periods are a great potential for unpredictable shocks. At any time, for this currency pair may be abrupt jumps of the course, which leads many traders to serious losses. Dollar-yen is very sensitive to political developments in this regard, it is often called the most sensitive. But, despite all its cunning, the Dollar-Yen still brings a tangible return, some traders. Apparently, the perfidy of these speculators exceed the level of deceit itself Currency pair. But to date, such Traders sufficiently small. Newcomers to trade on U.S. dollar-yen will be very hard, but little chance of profit is always there. Forecasts of the leading banks and financial centers relative motion dynamics dollar-yen are the most misguided.
USD / CHF (U.S. Dollar-Swiss Franc)
This currency pair is one of the major forex, but it creates some difficulties for traders using technical analysis only. Sometimes for this currency pair there are long and uniform motion in different directions, but generally follows the couple very well the dynamics of motion of the pair euro-dollar. But, unlike the Euro-dollar, this currency pair best shows the dynamics of movement of the dollar is that sometimes the demand among traders. Therefore, Members may use the dollar-Frank for the analysis of the direction of movement of other currencies. For example, sometimes dollar-Frank makes a breakthrough certain technical level, and other currencies moving in the same direction with a delay. But it should be noted that the currency is very often false breakdowns levels, and just at this period usually triggers a lot of stop orders, and the price is set back. Projections for the currency more fortunate, rather than on currencies as described above. Therefore, for beginners it is more suitable, though not the most comfortable for some strategies.
GBP / USD (British Pound Dollar)
This currency pair is known for very large movements. Therefore, many beginners often do pipsing on the currency. For longer-term trading decisions should take into account the scale of market volatility, to trade less volume and count on the larger stop orders. Pound-Dollar known for frequent false breakout of resistance and support levels, which should always be taken into account when making trading decisions. Some beginners it seems that every pound is trading against the dollar, it means that the currency pair Pound / dollar may duplicate the dynamics of price movement of Euro-Dollar. But I warn you immediately, this statement is wrong. For some time data currency pairs move in the same way, but at one point, rates may go completely in the opposite side. For beginners, this currency represents the average degree of Trade, which is quite acceptable. So you can safely trade, but caution never pushes. Forecasts for this currency pair very often come true, with relative frequency, but much more frequently than expected in Jena. Couple reacts strongly to political data of their own country, so news of Great Britain will come in handy for Traders, who have chosen this currency pair.
USD / CAD (U.S. Dollar - Canadian Dollar)
This currency pair is very responsive to oil prices. With rising oil prices, the Canadian dollar, as a rule, too expensive. Therefore, those who are going to trade on this currency pair, you should begin to explore the trend of oil prices, but do not forget about the technical analysis. Newcomers to this currency pair is worth working with great caution, and the best time to increase the testing and validation of the financial tool. A forecast for this currency pair the most successful of American analysts, so their opinion is worth listening to.
AUD / USD (Australian dollar / dollar)
NZD / USD (New Zealand Dollar Dollar)
very similar to the behavior of currency pairs. Sufficiently well to technical analysis, so the trade these currencies are always worth listening to the opinion of technical analysts. From the fundamental data on these currency pairs is greatly influenced by the price for metals, and weather conditions. When bad weather and falling prices for metals course, tend to decline. Increasing metal prices slightly raises these courses currencies, but the weather is good, oddly enough, does not affect the rate of currency pairs. Overseas data majors enjoy a sufficiently large popular and considered to be highly predictable. But Russian traders so far, mostly just complain about these currencies. Newcomers to work with data financial instruments recommended that attention be paid to technical analysis, but do not forget to read the weather forecasts and trends in the prices for metals.
EUR / JPY (Euro-Yen)
As Yen-dollar pair is very unpredictable. Professional traders, this currency pair has a certain popularity. But for beginners, this financial tool will seem very complicated. Banks and financial centers of the projected traffic is bad enough, sometimes just guessing at the direction of motion.
GBP / JPY (pound-yen)
even more unpredictable and dangerous currency pair. Therefore, the newcomers better to abstain from trading on it. And the professionals when you turn the couple into his arsenal recommended more carefully file away skill deals.
CHF / JPY (Frank Yen)
Surprisingly (at the sight of Jena can already develop a syndrome of risk currency pair), but this tool is fairly predictable and can be successfully used by beginners. To analyze the movement of traders often use the chart of the currency pair euro-yen, which often duplicates the movement, but makes them a bit earlier. So sometimes beginners are using this time to catch a deal, and quite often remain in the win. But we should not immediately begin trafficking by this technique. At first, everything needs to hone a demo account and get used to the habits of a given currency pair. Analyst on the currency rather poor quality of the forecast, so will have to rely solely on their abilities. For beginners, this currency is fine.
EUR / CHF (Euro-Franc)
By According to many traders, this currency pair - perfect for beginners. Fluctuations in her very small. Teak fluctuations (the most minimal possible) sometimes exceed the difference Mezhuyev purchase price and sale price (spread) that is used for scalping. Sometimes there are periods of quiet movement. Scalping in such periods can yield very large gains to the deposit.
GBP / CHF (Pound-Franc)
currency pair often follows the course of Euro-francs, but sometimes gives the unpredictable turns. Pipsovat on this pair is very difficult due to the large spread and sharp fluctuations. In general, the currency - not the best option for beginners more appropriate for professionals who have found clever ways to tame this snake.
EUR / GBP (Euro Pound)
most quiet and calm the currency pair. If we carefully explore the graph, we see that sometimes the price movement of not more than a few paragraphs, and at weekly intervals there were occasions that the pair did not go beyond within the corridor of 10-20 points. But we should not forget that the price of one item is very high, so even small movements provide a very tangible difference in the deposit. Prediction of the currency pair, usually marketed under projections for the fall course. But with growth are more often unpredictable jumps.
Whatever the currency pair has not chosen trader should always remember that the Forex market is volatile and that was yesterday, and tomorrow may never happen again. Therefore, some methods no longer work
choose a pair, what next?
Once the trader decided on the currency pair should move to the next stage. He will be out the skills of work with this currency pair. At first glance it may seem that this process is not any special secrets that all elementary simple. But, in practice, many traders with years produce thin trading is a mechanism for their favorite currency pair. They know her as flaky. Know how and what news reaction couple, when more and when less volatility, track down the relationship with the movements of other currency pairs. This is not an exhaustive list of what makes a long work and surveillance of the nature of the behavior of the currency pair. Only long-term Practice reveals the hidden horizons and provides a glimpse into the depths motion mechanisms currency pair. But there still should be noted that every currency pair is living his life, which is changeable. Therefore, periodic currency pairs can change some of its characteristics, and if there is no constant surveillance of her behavior, then the trader faced with a fairly large changes in the accuracy of the analysis. But this usually happens either when severe economic shocks or prolonged leave Trader.
few words in conclusion
Speaking Trader-beginner to choose currency couples want to advise to begin to determine the trading strategy. But that is if it is, ie If you use ready-made idea. If there is a question development of a new trade strategy, it is sometimes required in the first place to choose a currency pair, and then develop the strategy itself. And sometimes the selection process couples and the development of trading strategies are so close to each other, represent something that merged into one, indivisible and interdependent. Therefore, everyone can have their skills in this business, his years of experience and prejudice against a particular currency pair.
As professionals in the Forex, then, at times, and they come to the need to change the currency pair or add to your arsenal of new ones.
Everyone loves her: one to sell yen and sufficient profitable, others say that the yen in the arsenal of the trader - the path to ruin. We hope that you will find a path that will bring you success in the Forex market, and may soon your life will change significantly for the better.
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