Forex participants are often interested in the 28 major forex pairs list. Buying and selling currency pairs brings a stable source of income for traders. Let’s join Learn Forex Trading to explore currency pairs in the forex market through the article below.
General overview of 28 major forex pairs list
Currency pairs in the Forex market are the tools that new traders often focus on the most. Therefore, mastering information about the 28 major forex pairs list. Including their characteristics and influencing factors will help traders determine which currency pairs are suitable and best for their trading strategy.
What are forex currency pairs?
The 28 major forex pairs list includes two paired currencies. Includes the base currency and the quote currency, along with the exchange rates between them. When trading a currency pair, the trader is buying one currency and selling another simultaneously. For example, when placing a buy order (Buy) on the AUD/USD pair, it means buying Australian Dollars (AUD) and selling US Dollars (USD).
The rate of a currency pair, or exchange rate, represents the rate of exchange between two currencies of two different countries. It can also be considered as the price of a country’s currency. Expressed through the currency of another country. For example, if the rate of AUD/USD is around 0.75, this means that one Australian Dollar (AUD) is equivalent to 0.75 US Dollars (USD).
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Classification of Forex currency pairs
The 28 major forex pairs list are classified into 3 main groups. These are major currency pairs, cross-currency pairs, and exotic currency pairs.
- Major currency pairs include currency pairs with the USD (USA) and strong currencies of countries with large economies. For example, Japanese Yen (JPY), Euro (EUR), British Pound (GBP),… This is the currency that accounts for about 80% of total transactions.
- Cross-currency pairs do not include the USD and often include currencies such as EUR, GBP, JPY, CAD, etc. This is the most traded currency group.
- Exotic currency pairs include a popular currency such as USD or EUR. Paired with the currency of a developing or emerging economy. Consider Mexican pesos or Brazilian reals.
Relationship between currency pairs in forex trading
The EUR/USD currency pair is one of the most popular pairs in the 28 major forex pairs list. They attract many traders because of their low spreads, about 0.7 – 1.2 pips. There is more stability than with sterling pairs.
USD/JPY is a popular major currency pair, especially due to its low spreads. To bring attractive profit opportunities to traders.
The GBP/USD pair has the largest fluctuation range in the Forex market. However, many traders still prefer it due to its high profitability.
USD/CHF is one of the major currency pairs. This type always attracts the attention of both new and professional traders.
AUD/USD is considered a major currency pair due to the strong Australian economy. This is also a large exporting country, especially in the fields of coal and iron ore. The price of this currency pair is often greatly influenced by fluctuations in this commodity industry.
Summary of 28 major forex pairs list popular in the market
Below is a list of 28 major forex pairs lists commonly encountered in the foreign exchange market:
- AUD/CAD: Australian Dollar and Canadian Dollar.
- AUD/CHF: Australian Dollar and Swiss Franc.
- AUD/JPY: Australian Dollar and Japanese Yen.
- AUD/NZD: Australian Dollar and New Zealand Dollar.
- AUD/USD: Australian Dollar and US Dollar.
- EUR/AUD: Euro and Australian Dollar.
- GBP/AUD: British Pound and Australian Dollar.
- CAD/CHF: Canadian Dollar and Swiss Franc.
- CAD/JPY: Canadian Dollar and Japanese Yen.
- EUR/CAD: Euro and Canadian Dollar.
- GBP/CAD: British Pound and Canadian Dollar.
- NZD/CAD: New Zealand Dollar and Canadian Dollar.
- USD/CAD: US Dollar and Canadian Dollar.
- CHF/JPY: Swiss Franc and Japanese Yen.
- EUR/CHF: Euro and Swiss Franc.
- GBP/CHF: British Pound and Swiss Franc.
- NZD/CHF: New Zealand Dollar and Swiss Franc.
- USD/CHF: US Dollar and Swiss Franc.
- EUR/GBP: Euro and British Pound.
- EUR/JPY: Euro and Japanese Yen.
- EUR/NZD: Euro and New Zealand Dollar.
- EUR/USD: Euro and US Dollar.
- GBP/JPY: British Pound and Japanese Yen.
- GBP/NZD: British Pound and New Zealand Dollar.
- GBP/USD: British Pound and US Dollar.
- NZD/JPY: New Zealand Dollar and Japanese Yen.
- NZD/USD: New Zealand Dollar and US Dollar.
- USD/JPY: US Dollar and Japanese Yen.
How to choose forex currency pairs?
When participating in the Forex market, deciding to choose the right currency pair is one of the most important decisions. Because making the wrong choice can bring risks and even loss of capital.
How to choose suitable Forex currency pairs
Here are some ways to choose the right currency pair from the 28 major forex pairs list :
- Understand currency pairs: Before starting, master information about Forex currency pairs. Also, make sure to clearly understand the differences between them. Popular pairs such as EUR/USD, GBP/USD, USD/JPY, and USD/CHF all have their characteristics. They reflect many factors such as economics, politics, and market fluctuations.
- Determine trading goals: Trading goals are an important factor when choosing a currency pair. Pairs with large ranges like GBP/JPY or EUR/JPY may be suitable if you want to make quick profits. On the contrary, if you want a stable investment, you can choose pairs like EUR/USD or USD/JPY.
- Assess risk: When choosing a currency pair, assess the risks that may arise. Pairs with large amplitudes will bring higher risks than stable pairs. Consider the exchange rate and economic situation to assess the risk of each pair.
- Test on a demo account: Before starting real trading, test currency pairs on a demo account. This helps you understand the properties of each pair. Thereby determining the currency pair that suits your trading strategy.
Which type is best among the 28 major forex pairs listed?
According to predictions of experienced investors and popular trading trends. Here are some recommended currency pairs to trade during the year:
EUR/USD or USD/EUR
- This currency pair has always maintained its position for many years in a row. It reflects the high liquidity and strength of the US dollar and the Euro.
- With safety and predictability, especially in the case of USD/EUR. It’s the perfect choice for those who don’t want to risk too much.
USD/GBP or GBP/USD
- USD/GBP is one of the most liquid currency pairs in the Forex market. It achieved third place in terms of global transaction volume.
- After the recession caused by Brexit, this pair has recovered strongly. It is expected to continue to be one of the important currency pairs in 2024.
USD/JPY or JPY/USD
- The USD/JPY currency pair is famous for its safety, stability, and high efficiency.
- Expected to be a great choice in 2024. Especially for investors who want to make quick profits. Because the rate of increase and decrease of this currency pair does not depend much on political events or external factors.
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Evaluate the pros and cons of the 28 major forex pairs list
Advantage:
- Popularity: currency pairs in forex are popular for their high liquidity and popularity. To help investors easily access information about exchange rates on media sites.
- Good liquidity: The high liquidity of currency pairs makes trading easier. Along with that, large trading volume reduces the possibility of price slippage and low spreads.
- Reduced volatility: Good liquidity also reduces the overall volatility of the foreign exchange market. This is intended to create more stable trading conditions.
- Lower costs: High trading volume reduces transaction costs. Especially on spreads, making major currency pairs more liquid.
Defect:
- Requires massive research: To be successful, investors need to regularly monitor a lot of market fluctuation data. It requires great effort and time to research the chosen currency pair.
- No guaranteed profits: Trading with 28 major forex pairs list does not guarantee profits or achieve high profits. At the same time, it requires deep understanding and risk management skills.
- Free market: Prices of major currency pairs are determined by supply and demand. Central banks cannot completely shape their value.
- Irregular profits: Trading major currency pairs does not bring regular profits. And it lacks reliability and stability like other assets on the stock market.
Conclude
28 major forex pairs list is the choice of many new traders when starting. Hopefully, the information and knowledge that Learn Forex Trading shares about currency pairs will help provide an overview. From there, it helps traders enter the market to choose the currency pair that suits their strategy.
Frequently asked questions
Which currency pair should I choose to trade forex?
High liquidity is an important factor when deciding on a currency pair to trade. Major currency pairs often have large liquidity and low spreads, reducing trading costs. However, the final decision depends on your trading strategy.
What are the pairs with the lowest spreads?
EUR/USD, USD/JPYS, GBP/USD, USD/CHFS,… are the major currency pairs with the lowest spreads due to large trading volume. Low spreads help reduce trading costs and increase profit potential.
What are the most liquid pairs?
For high liquidity, tracking statistics from FXSSI, the pairs with the highest figures in March 2023 are EURO/USD (28%), USD/JPY (13%), and GBP/USD (11% ). Note that liquidity may fluctuate over time and market conditions.