Which are the Most Traded Currency Pairs in Forex Trading?
Daily Forex Trading Market Transactions Turnover of Major Currency Pairs by Volumes
The USD is the most traded currency in the forex market, followed by EUR, GBP, JPY and CHF, the daily forex market trading turnover volume share taken by each of these 5 forex currencies in terms of percent is shown below:
USD - 85%
EUR - 40%
JPY - 20%
GBP -13 %
CHF - 9 %
Since Forex trading transactions are in pairs the total will be 200 %
For example the EUR USD pair: EUR USD = 100% EUR + 100% USD
Summing up the total of the 4 most traded currency pairs by volume = 85 + 40 + 20 + 13 + 9 = 167 % . Note these four currency pairs are made up of five individual currencies which make up the sum total of 167%.
Major Forex Trading Currency Pairs - Which are the Best Currency Pairs to Trade for Beginner Traders?
Major forex currency pairs have a combination of the USD and one other major - EUR, JPY, GBP, CHF.
Which are the Most Traded Currency Pairs by Volume?
- EUR USD
- USD JPY
- GBP USD
- USD CHF
These are the most traded currency pairs by volume and because they have a high trade turnover and are the most profitable.
These major currency pairs are the best forex currency pairs for forex day trading, if you want to make the most profit it is best to forex trade only these four most traded currency pairs only.
Therefore the Most Traded Currency Pairs in Forex Trading:
Forex Major Currency Pairs = 167 % of all turnover
Other Forex Minor Currency Pairs Combined = 33 % of all turnover
The more the liquidity of a currency, the more the volatility, volatility means a currency is likely to move in a forex trend in one particular direction up or down because these are the most traded currency pairs by volume and when the prices are moving in a particular direction within a forex market trend it is easier to make money as opposed to when prices are not moving in a particular direction - ranging market.
On the other hand, all the other forex currency pairs, also known as minor forex currency pairs or forex currency crosses only make 33% of all daily forex trade transactions turnover and are said to be illiquid, meaning they do not have a lot of volatility and as such most of their currency price movements are choppy or range bound. These means that the minor currency pairs are the most hard to analyze using forex technical analysis studies because they do not show defined market trend movements in one particular direction (they do not move in a forex trend).
For Example by just trading EUR USD then a forex currency trader will be participating on 85 + 40 = 125% of all forex trade transaction volume, which is two-thirds of all forex currency trade transactions. This is another reason why some forex traders just stick to the EUR USD alone.
