What factors should I look at when choosing a pair to trade?

Beginner Questions
1

What different factors should I look at when choosing a currency pair to trade?’

factors-to-look-at-currency-pairs
factors-to-look-at-currency-pairs1200×628 97.5 KB

1 Like
2

It depends on your personality and your trading strategy. For a beginner, it’s best to trade the major pairs.

3

This is nonsense, as a newbie one should leave exotic pairs alone but practice on demo all the major/minor pairs

This is the whole point in demo trading

4

You think it’s more important to get right when you trade, like UK v US session and time of day and days of the week?

Like trade UK open into US open and throughout that day?.

Trade more beginning of the week, Monday-Wednesday?

Close trades on Friday or don’t even trade much Friday?

I’m thinking if the pair is giving you the right signals, it doesn’t much matter what pair it is, right?

1 Like
5

You find out all of the above through months maybe years practicing

6

Yea, agree with you. Just thinking answering those questions might be more important than “what pair do I trade?”.

1 Like
7

It’s more important to select trades that are consistent to your (profitable) strategy method, and sticking like glue to the same process for every trade.

Trend trades to follow are AUD/USD, EUR/JPY & USD/JPY. But beware, today’s bearish markets are in a hateful uncertainty zone which causes any which way market reactive sentiment.

2 Likes
8

Some of the different parameters to look at while choosing a pair to trade are:

  • Volatility
  • Consider the trading session
  • Liquidity
1 Like
9

I would say it depends on the trading strategy of an individual. For a beginner, it’s best to trade the major pairs.

1 Like
10

You should practice on demo; and monitor your performances on each trading pair! If you get a consistent result; then surely you can go for that trading pair (live trading account)!

1 Like
11

demo is important , no way to deny but the experience we take from demo actually not works in a real account. this is the real fact.

1 Like
12

True, major Forex pairs are good options to start with; particularly the EURUSD! I see, more than 80% newbies start their trading career by EURUSD trading pair!

13

Check your previous records; if you are happy on the outcome; then go for it on once again! But, if you are not happy, then go back to the demo and practice once again!

14

Volatility and liquidity are two major factors. Go for pairs that have high liquidity and low/moderate volatility. Therefore, you should go for pairs such as EUR/USD, USD/JPY, GBP/USD, EUR/CHF, etc. Please avoid exotic pairs as they have high volatility. Also, keep a tab on all trading sessions & trade one that fits your needs.

15

Geographical location and times you can trade as this will impact the trading session you are active in.

1 Like
16

Along volatility and liquidity of the currency pairs also look for the currency pairs that can be easily predicted. For eg. EUR/USD, AUD/USD, USD/JPY, USD/CAD and NZD/USD.

17

what pairs do you trade?

18

got it. I was just looking for a little “guide” to start.

19

Look at these factors while choosing a currency pair to trade in the forex:

  1. Time of activity
  2. volatility
  3. cost of a trade
20

When choosing a pair to trade, there are 3 most important factors to look at -

  1. The volatility of the pair
  2. The liquidity of the pair
  3. And the spreads offered by the currency pair

Too high or too low volatility will be difficult for you to make profit from. A subtle volatility like EUR/USD is perfect.
Liquidity is very important. If you have high liquidity, your spreads will be low, and your profits will be more.

1 Like