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What Are The Most Traded Currencies In Forex?
Let’s talk about currencies. Understanding the Forex Currencies market and knowing the basic principles behind it, are a necessary tool for every trader. It also important for any type of investor. Trading currencies can diversify any portfolio investment. It also an excellent alternative when other markets are in doldrums. First, you must be familiar with the major currencies. The following list presents a brief review on them.
1. The US Dollar – USD.
Created in 1913 by the Federal Reserve Bank. also called “the greenback”. This is the local currency of the United States, the largest economy in the world. The USD is used as a benchmark against other major currencies. It’s particularly affected by central bank decisions and announcements regarding the interest rate policy.
2. The European Euro – EUR.
Considered as the main “enemy” of the USD. Represents the 17 “Eurozone” member countries. The Euro is managed by the European Central Bank (ECB) which is located in Germany. The currency tends to be slower in its fluctuations compared to other major currencies. On an average trading day it may be traded in the range of about 40 pips.
3. The British Pound – GBP.
Also called the “Cable” and “Pound Sterling”. It’s controlled by a government body in the UK, which is the Bank of England (BOE). The BOE is functionally equivalent to the American Federal Reserve. It manages the monetary system. The Currency is considered to be more volatile than its euro counterpart. The fluctuations come with a range of 100-150 pips a day.
4. The Japanese Yen – JPY.
Created in 1882 by the Japanese central bank. The last serves as the central bank of the second largest economy in the world. The JPY offers low interest rate. For that reason it”s associated with carry trades against more high-yielding currencies. Its fluctuations usually ranges from 30 to 40 pips. However it can reach up to 150 pips in volatile sessions.
Let’s talk about currencies. Understanding the Forex Currencies market and knowing the basic principles behind it, are a necessary tool for every trader. It also important for any type of investor. Trading currencies can diversify any portfolio investment. It also an excellent alternative when other markets are in doldrums. First, you must be familiar with the major currencies. The following list presents a brief review on them.
1. The US Dollar – USD.
Created in 1913 by the Federal Reserve Bank. also called “the greenback”. This is the local currency of the United States, the largest economy in the world. The USD is used as a benchmark against other major currencies. It’s particularly affected by central bank decisions and announcements regarding the interest rate policy.
2. The European Euro – EUR.
Considered as the main “enemy” of the USD. Represents the 17 “Eurozone” member countries. The Euro is managed by the European Central Bank (ECB) which is located in Germany. The currency tends to be slower in its fluctuations compared to other major currencies. On an average trading day it may be traded in the range of about 40 pips.
3. The British Pound – GBP.
Also called the “Cable” and “Pound Sterling”. It’s controlled by a government body in the UK, which is the Bank of England (BOE). The BOE is functionally equivalent to the American Federal Reserve. It manages the monetary system. The Currency is considered to be more volatile than its euro counterpart. The fluctuations come with a range of 100-150 pips a day.
4. The Japanese Yen – JPY.
Created in 1882 by the Japanese central bank. The last serves as the central bank of the second largest economy in the world. The JPY offers low interest rate. For that reason it”s associated with carry trades against more high-yielding currencies. Its fluctuations usually ranges from 30 to 40 pips. However it can reach up to 150 pips in volatile sessions.