Best Currency Pairs for Day Trading?

Hello All,

This is my first post, so before I ask anything, I just want to thank the excellent hosts of this site, and the entire active community that makes these forums so great. I’m new to Forex, but I’ve spent a lot of time researching over the last several weeks, and it doesn’t take long to figure out that is something special.

Sorry if my question is already answered someplace else. I looked, but I didn’t find it.

Also, I know my question deserves a “depends” answers, but I’m looking for your opinions.

I’m trying to decide on the one currency pair I want to focus on first. I believe I will be mostly day trading, and sometimes scalping. At first, I thought I would go with EUR/USD because it had the highest volumes. However, now I’m thinking GBP/USD, because it’s still in the top four traded pairs, and it may be more volatile which may fit my trading style better. Also, it might be easier to keep track of news and holidays that effect that pair vs. EUR/?, since the EU has so many members with their own news and holidays (or does the number of members dilute the impact of news and holidays for EUR/? so that it doesn’t matter as much?). Finally, until I can do this full time :), I have to squeeze my trading in around my parental and professional lives. I plan to trade the overlap between the London and New York sessions, from 7 AM CST - 11 AM CST.


I like to trade USDCHF and EURUSD because they usually move in opposite directions. You can hedge with them if you like, and usually get a positive swap if your broker uses swap.

I’ve had good luck with the USDJPY, EURUSD on those time frames, I like the GBPUSD as well but for day trading I want a pair that has the lowest spread possible. The USDJPU and EURUSD are good under that criterion.

GBP/JPY and GBP/CHF are great currency pairs. They have a lot of volatility if that’s what you’re looking for.

If you are looking to trade the news you’ll need to get a good broker… A lot of the brokers out there get very dicey when fundamental indicators are announced… Some pop up huge pip spreads and some even freeze up when the market moves so quickly… I’ve seen 20-30 pip moves in less than a minute on some pairs…

I myself and am just a beginner with forex… I’ve traded demo for around 3 months and just recently started trading live with a small account using very small amounts of leverage… I’m attempting to get the psychological part of trading in check before I use larger amounts of leverage…

If have found the largest difference between demo and live is sticking to your method and your rules… In demo I really didn’t care what happened in the back of my mind but now that I’m using real money it’s very different… Back testing your methods and indicators are great with a demo but I’ve learned much more in 2 weeks of live trading than I did with a 3 month demo…

Thanks for your opinions, everyone.

Shaznat, I’m actually looking to avoid news (and holidays) when I first get started. That’s why I’m wondering whether the EUR wouldn’t be more effected by both (more members with more news and holidays).

Have any of you found that to be true?

And Shaznat, good luck trading live!

EURJPY is also a great choice for day-trading

I am a newbie to FX, please excuse me for asking stupid questions.

1> I don’t see how I can make money on day trades - closing all open positions at the end of the business day. I like to go long AUD/CAD as I believe Australia’s economy will still be doing good when the U.S. goes into recession. And I believe Canada will go down with U.S. But when I look at the bid/ask = 0.8753/0.8763, the spread is 10 pips. I have been observing the net change (-0.0008) of this currency pair for serveral hours. I don’t think it will go beyond that to end of the day. No matter I long or short, I will lose money if the Net Day Change will not go beyond the spread. I see other currency paris are having more or less the same big spreads.

2> Can anyone out there explain how the roll over work? My broker Tradefreedom has the following charges applied to holding the positons overnight.

Positions held until their Value Date

Spot Forex positions held at the end of the business day before their Value Date will be rolled over to a new Value Date on a Tom/Next basis. As part of the rollover, positions are subject to a swap charge or credit based on the LIBOR/LIBID interest rates of the two traded currencies with an added a markup of +/- 0.5% (for retail accounts) plus an interest component of LIBOR/LIBID +/- 0.75% for any unrealized profit/loss on the position.

SWAP RATE: AUDCAD 31-Oct-2007 01-Nov-2007 -0.000018 (Long) -0.000058 (Short)

3> Since FX is traded in 24 hours, when is the begin of business day and end of business day? I am living in Canada.

4> If the overnight charges are high, FX trading is very like grambling, it is not for investiong. It make me feel like I’m just going to Casino and count how much I got left at the end of the day.

5> How often people will leave their open positions overnight? Is it wise to do that?

To Bulicia2006 :

You have asked a set of detailed questions requiring very comprehensive answers.

Let me put you on the right footing from the word “go”.

When you have questions, it is best to do your own research to answer them. Sometimes this is exhausting, you need to buy books and scour the internet - but it is good for you because it is the only way you really learn. It is just too easy to have everything handed up to you on a plate. Spoon feeding new traders does [U]not [/U]make a good trader.

It is only when you have exhausted all research avenues and still have no answer - then is the time to ask on this forum. You questions will also be more intelligent.

Your questions are already previously answered on this forum.

I suspect that there are lazy traders posting on this forum who cannot be bothered doing any research. They take the easy road and ask all their questions on this forum and expect to get spoon fed.

They will usually (not always) get their answers but they will become poor traders and lose all their money and generously donate it all to us.

[B]Doing your own hard research to exhaustion is a mandatory requirment for success as a forex trader.[/B]

[B]Having said that, I will answer you questions[/B] :

[B]1)[/B] When learning to trade you should keep away from rollovers. Thus day trade - use a 1/2/4 hour timeframe. Daytrading does make money. I not only daytrade but I also scalp and make good quick money.

     What are you doing trading the exotic pairs?? :confused:  

As a beginner you should trade only the 4 majors ie

Your spreads on these - 3/4 pips at most. If not [U]dump [/U]your broker immediately. :mad:
You continue with higher spreads at your own peril. :mad:

[B]2)[/B] I specially set up the below thread as a detailed teaching on rollovers. Go to it, study it, read every post very carefully untill you understand them.

Read it again…and again. You will learn.

[B]3)[/B] Begin and end of day varies with brokers. Location is one variable. GMT time is also used. Other brokers do rollovers 12 hours after you enter a trade. Phone your broker to find out their begin and end of day.

[B]4)[/B] What is the question?

[B]5) [/B]Holding positions overnight is good if you are a trend trader and you have carefully analysed your trade. You have seen that the trend is going your way. The next day you will be further ahead in profit.
A trailing stop is used to lock in profits. Find out what a trailing stop is. :slight_smile:

Hello, Tymen. For some reason, I end up reading and very much appreciating many of your posts to babypips.

I followed your link to the “The Dreaded Danger of Rollovers” thread. I noticed that back in May of this year you said you were going back to the share market, but from your recent posts on babypips it looks like you haven’t given up entirely on forex.

I’m new to day trading. I’m starting with forex, but I’m also interested in stocks. I haven’t seen any postings from forex traders who are also stock traders that give a candid comparison of the two.

  1. Can you give a candid comparison of the two?
  2. If someone was going to start day trading with one or the other, which would you recommend they start with first?
  3. Is there a web site for learning to trade stock that’s as good as babypips for learning to trade forex (in your opinion)?



Thank you for your advices and sharing your insights with me.

I understand that FX trading requries a lot of knowledges and guts and I have been scouring Internet for knowledges. That is why I can find this site.

I’m glad to see people posting their successful stories here, so other people can learn from them.