Which currencies should we stick to?

Beginner Questions
1

I have such a plethora of currency pairs in my platform that I could trade, but I’d like to narrow down the number that I have to review throughout the day. Is there a common list of ones I should consider as they are the most liquid/have reasonable spreads? If I can delete a ton of them from my list it would really help.

Any help appreciated.

2

The major currencies will have the narrowest spreads and highest liquidity

3

Yeah, the majors would fit your criteria. Personally, I look at EURUSD, GBPUSD, EURGBP, USDJPY, USDCAD & AUDJPY but predominantly I’ll look to trade EURGBP & the U.S. dollar against which ever is strongest out of the euro & the pound.

4

Another option (this is what I do) is not to narrow the number of pairs you review each day but to narrow the number of days you review each pair. One switches to trading on weekly charts and suddenly 75 pairs becomes less time consuming when he updates his orders just one night a week.

-Adrian

5

I suggest you stick with the majors for the time being since these are the most actively traded ones.

6

I think that depends on you. There is no right or wrong. Just make sure you have a good reason why you do not want to trade a specific currency pair.

7

I’m assuming from the standard of the question that you don’t have a strategy or anything yet? I had a system that was giving me a decent amount of success on USDJPY but not on other pairs so it’s worth remembering that some systems will work for certain currencies & not for others. Don’t have too many pairs & diversify your selection a wee bit too.

8

Most people will tell you to stick to the majors and I think that it is up to a trader’s personality. You can’t go wrong which ever you choose. More important is to understand the currency pair correlations.

9

If you make your list too short, you might have the problem of not getting any trade signals and ending up being on the sideline the whole time. If you use the combinations of the 8 most traded currencies (USD, CAD, EUR, GBP, CHF, JPY, AUD and NZD) then you will get a list of 28 currency pairs which have enough liquidity to trade any time you wish with acceptable spreads.