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Using the Top 4 Most Active Currency Pairs in Forex Trading



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Which are the most active forex trading currency pairs to trade? I know this question haunts a lot of forex traders and most traders are trying to find out the answer for this. So do you have any idea on which are the forex trading currency pairs are that most actively traded? If you do not, then you will have to continue to read this article and find out whether you are trading them with your forex trading system, be it Forex Ambush or FAP Turbo.

Many of the traders only react based on what most people think are the most active currency pairs and not by some statistics. So I’m going to provide you with some data here so that you can be clear on the figures and this is taken from a forex volume survey (based on October 2008).

Do you know that the most active trading center is in Europe? And if you guess it correctly…yes…it is London! It has a transaction of close to $1.5 billion daily on average. It is even more than New York, which is twice the figures behind London. However, New York is still more than the total figures of Sydney and Singapore combined. By the way, if you think Singapore is a very small country, yes it is, but the transactions for currency trading is one of the largest, mostly from institutions and banks.

I’m sure you have heard on somewhere that in forex market, spot forex is the largest component. Well, that’s not totally true here. It is the swap market that is the largest part of the forex market actually. If you think carefully, you will agree that swap market is the largest because of the huge international trades and capital inflows and outflows. Back to spot trading, if it is the biggest part of forex trading, then it has to be in New York.

In London, EUR/USD is taking up around 40% of the trading with USD/JPY at around 15%. The rest of the pairs like EUR/JYP, USD/CHF make up the rest of the percentage. In New York, EUR/USD is trading for one third of the market while USD/JPY at around 20%. EUR/JPY, GBP/USD and USD/CAD make up the rest of other trading activities at 75%. In Sydney, of course AUD/USD is the largest traded pair while USD/JPY and EUR/USD come second.

To summarize, the most active traded currency pairs are EUR/USD and USD/JPY, followed by GBP/USD and EUR/JPY. So this means that there are also more liquidity on these pairs and you might want to include them in your forex strategy if you have not do so.

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The author, Daniel Su, is the founder of http://www.ForexTradingPower.com where you can get free premium forex trading tips and resources. Daniel Su specializes in teaching real people how to trade the Forex market for long term financial success.

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