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7 Major currency pairs in forex trading

A major currency pair refers to the most frequently traded and highly liquid currency pairs in the foreign exchange (forex) market. These pairs typically involve the currencies of developed economies with stable political and economic systems. The major currency pairs are:


euro currency

  • The EUR/USD pair is often referred to as the "euro dollar" or simply "euro."

  • It represents the exchange rate between the Euro, the currency of the Eurozone, and the US Dollar.

  • As the most actively traded currency pair, it is highly influenced by economic indicators, monetary policy decisions from the European Central Bank (ECB) and the Federal Reserve (Fed), and geopolitical events impacting Europe and the United States.


2. USD/JPY (US Dollar/Japanese Yen):

  • The USD/JPY pair is often called the "dollar yen."

  • It represents the exchange rate between the US Dollar and the Japanese Yen.

  • This pair is influenced by factors such as economic data from both countries, interest rate differentials, trade relations, and market sentiment towards risk-on or risk-off environments.



3. GBP/USD (British Pound/US Dollar):

  • The GBP/USD pair is commonly known as "cable" in forex trading.

  • It represents the exchange rate between the British Pound Sterling and the US Dollar.

  • The pair is influenced by economic indicators, monetary policy decisions from the Bank of England (BoE) and the Fed, Brexit developments, political factors in both countries, and global market sentiment.


4. USD/CHF (US Dollar/Swiss Franc):

  • The USD/CHF pair is often called the "dollar Swiss" or "swissy."

  • It represents the exchange rate between the US Dollar and the Swiss Franc.

  • The Swiss Franc is considered a safe-haven currency, and this pair is influenced by factors such as Swiss monetary policy, economic data, global risk sentiment, and interventions by the Swiss National Bank (SNB) to manage the Franc's value.



5. USD/CAD (US Dollar/Canadian Dollar):

  • The USD/CAD pair is sometimes referred to as the "loonie" due to the image of a loon, a bird depicted on the Canadian dollar coin.

  • It represents the exchange rate between the US Dollar and the Canadian Dollar.

  • This pair is influenced by factors such as oil prices (as Canada is a major oil exporter), economic data from both countries, interest rate differentials, and trade relations between the United States and Canada.


6. AUD/USD (Australian Dollar/US Dollar):

  • The AUD/USD pair is often called the "aussie dollar."

  • It represents the exchange rate between the Australian Dollar and the US Dollar.

  • This pair is influenced by factors such as commodity prices (especially gold and iron ore), interest rate differentials, economic data from Australia and the United States, and market sentiment towards risk.



7. NZD/USD (New Zealand Dollar/US Dollar):

  • The NZD/USD pair is commonly known as the "kiwi dollar" or simply "kiwi."

  • It represents the exchange rate between the New Zealand Dollar and the US Dollar.

  • This pair is influenced by factors such as commodity prices (particularly dairy products), interest rate differentials, economic indicators from New Zealand and the United States, and global risk sentiment.


These major currency pairs serve as benchmarks in the forex market and provide opportunities for traders to speculate on the movements of these currencies against each other. They are influenced by a wide range of economic, political, and market factors, and their dynamics can provide valuable insights into global market trends and sentiment.



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