Best Currency Pairs to Trade In Forex In 2022

Best Currency Pairs to Trade In Forex In 2022

Currency pairs are the national currencies from two countries coupled (or pegged against each other) for Forex trading. Both currencies have exchange rates on which the trade will have its position basis. As you may know, all the possible trading’s within the forex market, whether selling, buying, or trading, will occur through currency pairs. 

There’s no one best currency pair in Forex, and your strategy and experience are the ultimate deciding factors, but here we will dig deep and talk about trading pairs that are best for daytime, nighttime, beginner, pros, and more.

This article will cover the most important, most profitable, and overall the best forex pair to trade during different sessions. We will also talk about the best trading pairs for beginners and the safest strategies and pairs for them. Stick around to find out more.

What Is The Best Currency Pair To Trade In Forex?

The answer highly depends on your strategies, priorities, expertise and risk tolerance. With over 200 countries globally, you can find many currencies to trade. However, all may not have the potential to deliver the best results. 

There is no best Forex pair to trade per se. Still, If you are a newcomer to forex trading, it is advisable to stick to the major pairs (which we’ll cover below) until you become comfortable enough to trade minor and exotic pairs. (Don’t worry, we’ll cover what minor and exotic pairs are as well!)

But if you want an answer to your question, here it goes.

The best currency pairs are those with high liquidity and low volatility, which also have lots of educational materials and signals available for them. You have to choose a pair that operates in your desired time window. For example, Asian market pairs might keep you awake at night, no matter how lucrative they might be. Another critical factor in choosing the best currency pair to trade is its availability in your broker.

Below, we will cover some of the best-traded currency pairs in Forex and the necessary information about them.

EUR/USD Pair

EUR/USD is the most traded forex currency pair on the forex market. It makes up for 24.0% of daily forex trades as of 2019. This pair is popular because it’s representative of the world’s two biggest economies: the European Union and the United States of America.

The high trading volume of EUR/USD ensures that this pair has a lot of liquidity, resulting in tight spreads. Liquidity and tight spreads are tempting for traders because they can make large trades even with little impact on the market.

USD/JPY

The USD/JPY currency pair, also known as ‘the gopher,’ puts the US dollar against the Japanese Yen. USD/JPY is the second most traded forex currency pair on the market, representing 13.2% of all daily forex transactions as of 2019.

This pair is known for its high liquidity, mainly because the Yen is Asia’s most heavily traded currency, and the US dollar is the most commonly traded currency globally.

EUR/GBP Pair

Both EUR and GBP are among the strongest currencies globally. European Union uses the Euro while the United Kingdom uses the Pound Sterling; therefore, the EUR/GBP is a relatively stable currency pair and heavily traded. A significant change in their prices would draw massive attention in the forex market and outside it. 

It would be best to trade the EUR/GBP pair during the European Forex session; an easy way to recall this is “don’t trade when it is dark in London.”

USD/HKD Pair

Trading the USD/HKD is a perfect way to access the world’s two largest economic rivals, the US and China. However, its fixed self-correcting system makes it best suited to experienced traders.

This pair’s trading volume has doubled between 2016 and 2019, showing its importance.

The Hong Kong dollar can fluctuate within a band of HK$7.75 to HK$7.85 to US$1. Traders can make a profit from any price movements within this band.

USD/CAD Pair

The USDCAD currency pair is a very stable currency pair to trade. While Simultaneously, it displays good volatility characteristics, allowing traders to make ample profits from its exchange rate price movement. 

USDCAD is one of the most liquid Forex pairs to trade. Liquidity is an essential consideration for all traders, particularly those that rely on day trading or swing trading strategies. The more liquid a pair is, the better the bid-ask spreads would generally be.

USD/CNY Pair

The USD/CNY currency pair is the US dollar, pegged against the Chinese renminbi – commonly known as the Yuan – representing 4.1% of daily forex trades as of 2019.

Since the beginning of the US-China trade war, the Yuan has largely been decreasing relative to the US dollar, mainly due to the Chinese government, which has let the Yuan depreciate. The Chinese government allows this to make the country’s exports cheaper and increase their already massive market share in countries other than the United States. We highly recommend that all traders keep an eye on the US-China trade war as any developments will likely affect the price of this currency pair.

USD/KRW Pair

USD/KRW puts the US dollar against the South Korean won. This pair makes up for 1.9% of daily forex transactions as of 2019.

The South Korean economy has become Asia’s fourth-largest economy and eleventh globally. This currency pair is well-traded mainly because traders and speculators seek exposure to another key Asian market, besides Japan, China and Hong Kong.

AUD/USD Pair

AUD/USD is occasionally referred to as the ‘Aussie’ and represents the Australian Dollar against the US dollar. It makes up for 5.4% of daily forex trades as of 2019. 

The value of the Australian Dollar is closely tied to the value of its exported goods, such as metal and mineral exports such as iron ore and coal, accounting for a large proportion of the country’s GDP.

USD/CHF Pair

The USD/CHF currency pair, commonly known as the ‘Swissie,’ puts the US dollar against the Swiss franc. USD/CHF is another popular currency pair because the Swiss financial system has historically been a safe haven for investors and their capital.

As a result, traders often turn to CHF during increasing market volatility. Still, the Swiss franc typically sees less interest from traders during times of market stability. 

Since CHF is usually turned to primarily only during economic volatility, it is not as actively traded as other currency pairs on this list. However, USD/CHF still accounts for 3.6% of all daily forex transactions as of 2019.

What are forex major pairs?

The major pairs in the Forex market are the four most heavily traded currency pairs in the forex market. The four major pairs at the moment (Q1 of 2022) are EUR/USD, USD/JPY, GBP/USD, and USD/CHF.

Major pairs are considered major because they are the most popularly traded pairs on a daily basis. All of the major pairs include the US Dollar because it’s the world’s most traded currency and leading reserve currency.

All those, as mentioned earlier, four major currency pairs are deliverable currencies and are part of the Group of Ten (G10) currency group. While these currencies contribute significantly to economic transactions, they are also the most heavily traded pairs for speculative purposes.

The top seven major currency pairs include:

EUR/USD – Euro/US Dollar (also known as “Fiber”)

USD/JPY – Euro/Japanese Yen (also known as “Ninja”)

GBP/USD – British pound/US dollar (also known as “Cable”)

USD/CAD – Us Dollar/Canadian Dollar (also known as “The Funds”)

NZD/USD – New Zealand Dollar/US Dollar 

AUD/USD – Australian Dollar/US Dollar

USD/CHF – US Dollar/Swiss Frank

What are Forex minor pairs?

Minor Forex pairs are pairs that don’t include the US Dollar. They are also known as cross-currency pairs. The most widely traded ones include British Pound, the Euro and the Yen.

The top seven minor currency pairs include: 

EUR/GBP — Euro/British pound -also known as the “Chunnel.”

EUR/JPY – Euro/Japanese Yen – also known as “Puppy.” 

GBP/JPY — British pound/Japanese Yen, also known as “Guppy.”

NZD/JPY — New Zealand dollar/Japanese yen

GBP/CAD — British pound/Canadian Dollar

CHF/JPY — Swiss franc/Japanese yen

EUR/AUD — Euro/Australian dollar

What are forex exotic pairs?

Exotic pairs are a mixture of a major currency with a currency of a developing economy (such as Brazil or Mexico). These exotic pairs are not traded as often as major or minor pairs and are best reserved for seasoned traders. We highly recommend beginners to stay away from exotic pairs, unless it’s for educational reasons!

The most popular exotic currency pairs are:

EUR/TRY – Euro/Turkish Lira

USD/HKD – US Dollar/Hong Kong Dollar

JPY/NOK – Japanese Yen / Norwegian Krone

AUD/MXN – Australian Dollar / Mexican Peso

GBP/ZAR – British Pound / South African Rand

NZD/SGD – New Zealand Dollar/ Singapore Dollar

What is the easiest currency pair to trade?

Some traders claim that EUR/USD is the easiest and the most stable currency pair to trade. This pair is the best choice not only among beginners but also for professional traders. Due to tight spreads and liquidity, EUR/USD is the most traded currency pair. It’s the recommended pair for beginners and even pros!

But if we said it once, we’ve said it a thousand times; there’s no easy thing about trading in Forex. It would be best if you had proper knowledge and expertise to trade, and if you don’t, there’s a lot of information and educational material out there that will help you achieve your goals.

No one – let that sink in – absolutely no one is going to make it in Forex by googling phrases like “best forex pairs to trade today” and trading whatever comes up.

What are the best currency pairs to trade for beginners?

Again, EUR/USD seems to be the easiest and the most stable currency pair to trade. We recommend that you start your trading journey in EUR/USD safe waters if you are a beginner.

Many beginner traders make a rookie mistake and switch between too many currency pairs. As a rule of thumb, anything over ten pairs is too many for a beginner trader or anyone still struggling. You may be able to stretch that to 12 or even 15, but anything above ten can quickly get out of hand.

Your primary focus should be learning the process, not making profits if you’re still struggling. Trying to make money should not be your number one priority. Developing qualities such as patience and learning strategies that fit your personality should be top of your list.

So, by all means, mingle in major pairs, pick a few, and practice your way into minor and exotic pairs, and only then try taking on more than 30 pairs. It will get overwhelming sooner than you think.

What is the most profitable currency pair to trade?

Most profitable are those pairs with high volatility. On the other hand, such pairs are most risky. It’s a trade-off!

If you are interested in a stable but small income, use popular pairs like USD/EUR, and might we suggest your read more scalping? It’s a strategy of day trading that you might find interesting.

Bear in mind that making profits in Forex depends on your strategy and expertise, and there’s no one solution fits all answer for this question.

What are the best forex pairs for scalping?

Successful scalping needs foreseeing market movements and careful and constant analysis of the market and its news. The list mentioned below is not financial advice. The most common pairs for scalping are as follows:

– In Major pairs, EUR/USD, USD/CHF, GBP/USD, and USD/JPY are the most profitable.

– In Minor pairs, AUD/JPY, NZD/JPY, and EUR/AUD.

– The most profitable exotic pairs are USD/SEK, USD/ZAR, USD/TRI, NOK/USD, and BRL/USD.

Pro Tip:

If you happen to choose USD/GBP pair, scalping has some advantages. Both US and UK have a similar approach to economic management, prioritizing a robust private sector, competitive tax rates, and a high growth rate. Moreover, the long history of two-way trade across the Atlantic provides patterns that can be analyzed.

While USD/GBP lacks the attraction of some more exotic currency pairs listed above – which all have the right attributes for scalping -, don’t forget that scalping is not about winning big once – instead, it is about winning a series of small trades and making a steady income, in the long run.

What are the Best forex pairs to trade during each session?

Essentially, opportunities lie in a significant price movement caused by reports, breaking news or a major trend getting stronger or overturned. 

All these drivers happen during specific country/currency daytime. Here’s a guide to trade what, when, where:

What Are The Best Forex Pairs To Trade During the New York Session?

The New York session starts at noon and ends at 21:00 GMT. So, the best pair to trade during the New York session is any currency pair with the USD.

The best forex pairs to trade during the New York session would be the major pairs, such as:

 EUR/USD, USD/JPY, GBP/USD, EUR/JPY, GBP/JPY, and USD/CHF. 

These abovementioned pairs will be the most liquid during the US session, mainly the EUR/USD during the overlap (with the European session).

Major crosses like GBP/USD and USD/JPY will have a tremendous amount of liquidity and volatility, making them perfect to trade for forex traders. Currency pairs that won’t be affected by the New York session, like AUD/NZD, should be avoided.

What Are The Best Forex Pairs To Trade During the London Session?

Due to the volume of transactions that take place during European sessions, there is so much liquidity that almost any pair can be traded. Of course, it may be best to stick with the major pairs again (EUR/USD, GBP/USD, USD/JPY, and USD/CHF), as these typically have the tightest spreads.

During the first few hours of the London session, the best pairs to trade will be GBP and EUR-backed pairs. These will include EUR/USD, GBP/USD, GBP/CHF, GBP/NZD, EUR/JPY, etc. 

During the last few hours of the London session, the New York markets will open, and USD pairs will also become a great option.

If you are a night owl or just too busy to trade during the New York or London session times, you may seek the best currency to trade at night. In this case, it may be the time when Sydney (AUD, NZD) and Tokyo (JPY) sessions come up, depending on where you live. Keep reading to find out the best forex pairs to trade after 5 pm.

What Are The Best Forex Pairs To Trade During Sydney Session?

Sydney session is the first session of the forex market (FX). During this session, you should look to trade currency pairs that include the AUD and the NZD.

While it is the smallest of the big markets, this session sees a lot of initial action when the markets reopen because individual traders and financial institutions are trying to regroup after the long pause since Friday afternoon.

What Are The Best Forex Pairs To Trade During Tokyo Session?

When liquidity is restored to the forex market at the start of the week, the Asian markets are obviously the first session to see any action. Unofficially, the Tokyo capital markets represent activity from this part of the world and span from midnight to 6 am (GMT).

However, many other notable countries are present during this period, including China, Australia, New Zealand, and Russia. 

So the best forex pairs to trade during Asian sessions are:

EUR/JPY

AUD/USD

USD/JPY

AUD/JPY

These are also the best forex pairs to trade at night as well.

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Best forex currency pairs to trade in a nutshell

Currency pairs are the national currencies from two countries coupled for Forex trading. All the possible tradings within the forex market, whether selling, buying, or trading, will occur through currency pairs. There is no best Forex pair to trade per se. Still, If you are a newcomer to forex trading, stick to the major pairs until you become comfortable enough to trade minor and exotic pairs.

The most profitable currency pairs are those with high volatility. On the other hand, such pairs are most risky. EUR/USD is the easiest and the most stable currency pair to trade. This pair is the best choice not only among beginners but also for professional traders. Due to tight spreads and liquidity, EUR/USD is the most traded currency pair.

USD/GBP pair is the best pair for scalping as both countries have a similar approach to economic and financial management.

Opportunities lie in a significant movement caused by reports, breaking news or a major trend getting stronger or overturned. All these drivers happen during specific country/currency daytime. 

If you are a morning person, we suggest you try US and European markets, and for the night owls, we recommend Asian markets.

So, in a nutshell, there is no solution fits all and no one currency pair that can make you or break you. It’s depended on the time, your knowledge and expertise, and just a little bit of luck!

May the odds be ever in your favour!