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5 most traded currency pairs

Published on: 26/01/2022 | Modified on: 16/09/2022

The most traded currencies in the world come from multiple continents and they belong to some of the strongest economies. These include major forex pairs, as well as "safe haven" currencies and those with historically stable trade links. This article is a guide to five of the most traded currency pairs on our platform.

The foreign exchange market is the largest and most liquid market in the world. It offers exchanges between any two nation’s currencies and includes major, minor and exotic currencies. The result is a market that offers hundreds of possible currency pairs to trade. At CMC Markets, we offer 330+ pairs to trade, so continue reading to learn more.

KEY POINTS

  • The foreign exchange market is the largest and most liquid market in the world
  • The United States dollar (USD) is the most commonly traded tender
  • Some of the most traded pairs include GBP/USD, USD/JPY and EUR/GBP
  • Major forex pairs in particular provide more liquidity and come with lower spreads and margin rates
  • We offer the highest number of currency pairs in the industry available to trade*
Reviewed by
Chief Market Analyst
mhewson_CMC

What are currency pairs?

Currency pairs​ measure the value of one currency against another. They are split into a base currency and a secondary quote currency. An example is perhaps the most popularly traded currency pair in the world, the EUR/USD, where its price represents how much of the quote currency, the US dollar, is required to buy one unit of the base currency, the Euro.

Each currency pair has a bid and ask price​. The bid price is defined as the maximum price a buyer is willing to pay for the currency, the ask price is defined as the minimum price a seller would be willing to accept the currency for, and the bid-ask spread represents the difference in pricing between the two currencies.

In some cases, forex traders prefer to trade on currency pairs with a lower or tighter spread as it reduces the overall costs involved in the trade. However, some traders prefer to trade on volatile currency pairs with wider spreads and lower liquidity in an attempt to profit from the fluctuating gaps in price.

Learn more: what is forex trading​?​

The United States dollar (USD) is the most commonly traded currency in the world, and therefore most major forex pairs include the USD as the base or quote currency. When combined with other currencies from some of the world’s biggest economies, including China, Japan and the United Kingdom, these are seen as major crosses.

Major forex pairs are particularly attractive to traders as they signify the most prosperous and stable economies across the globe, and traders are able to take advantage of their low spreads that accurately represent market value. Major forex pairs are often the most traded currencies amongst beginners.

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We offer access to an award winning/market leading number of forex pairs*, at 330+, including all major crosses that trade 24 hours five days a week. Try currency trading in a zero-risk environment with a free demo account, which grants you access to our institutional-grade trading platform and £10,000 in virtual funds for you to trade forex with.

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5 top currency pairs to trade

Below is a list of five of the most traded currency pairs in the world, which is organised according to current economic data, spreads, and margin rates from our platform.

Instrument Price Min spread Margin rate
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Spread bet or trade CFDs on 330+ forex pairs

USD/JPY​

“The Gopher” is a combination of the US dollar and the Japanese yen. It is one of the most popular forex pairs in the world due to the prominence of the JPY throughout Asia and the USD worldwide. It boasts a high liquidity, meaning that traders can buy and sell the currency pair in large volumes without the price fluctuating too much in its exchange rate. It also has one of the tightest spreads in the forex market, reducing the overall costs of the trade.

EUR/USD​

“The Fiber” is a combination of the Euro and the US dollar. This is generally considered the most traded currency pair as it stems from two of the world’s largest and most reputable economies. Similar to the USD/JPY, this currency pair is associated with very low spreads, high liquidity and the ability to place large volumes of trade. This combination can be seen as one of the best currency pairs for forex scalping​, as the markets are mostly stable throughout the year, therefore, it is perhaps one of the most profitable currency pairs in terms of smaller and more frequent earnings.

GBP/USD

“The Cable” is a combination of the British pound sterling and the US dollar. This is seen as a particularly volatile currency pair, due to its frequent fluctuations in price, exchange rate and pip movements. This can result in large profits if the trader is successful, however, it can result in equally great losses when market volatility is at a high. The GBP/USD is particularly favoured by day traders, who aim to take advantage of price fluctuations by dipping in and out of the market at a quick and precise pace. For this reason, it is also one of the best forex pairs for swing trading, another short-term forex strategy. It is recommended that those who trade this volatile currency pair strengthen their knowledge of technical analysis of the market before opening any positions.

EUR/GBP​

“The Chunnel” is a combination of the Euro and the British pound sterling, a play on words for the Channel Tunnel that connects both continents. This currency pair is typically seen as very strong, given the proximity of regions and their solid history of trade. Given the situation of Brexit on the economy, the forex pair has become more volatile in recent years, which can be very attractive for skilled traders. The exchange rate also relies on changes to interest rates which are announced by regional banks, therefore, one currency can suddenly strengthen against the other, making the pair much more volatile. This also applies to the other currency pairs on this list.

USD/CHF​

“The Swissie” is a combination of the US dollar and the Swiss franc. For many years, the financial stability of Switzerland has been used as a ‘safe haven’ for investors of the forex market, who will rely on trading the CHF in times of market volatility. Therefore, this is a popular forex pair for traders when the economic or political situation of a region is uncertain. As the value of the CHF strengthens against the USD due to increasing investment, the price of this currency pair starts to drop. Although it is one of the most stable currency pairs to trade and therefore offers many benefits. However, when the markets are in a more stable position, the USD/CHF may be of less interest to traders who opt for other major currency pairs that are featured on this list.

Trade on forex indices

Expecting major economic announcements? Our forex indices are a collection of related, strategically-selected pairs, grouped into a single basket. Trade on our 12 baskets of FX pairs, including the CMC USD Index and CMC GBP Index.

Explore our forex indices
  1. Choose your product. You can spread bet or trade CFDs on the forex market.
  2. Pick a currency pair. This may be one from our list or a more exotic pair.
  3. Decide on a strategy. You can either go long and 'buy' if you think the price will appreciate, or go short and 'sell' if you think it will depreciate.
  4. Follow forex market news. This can provide insight and predictions into future movements of currency pairs.
  5. Understand the risks of leveraged trading. This greatly increase the chance of losses, so familiarise yourself with stop-loss measures as part of an effective risk-management strategy.

Summary

We offer the highest number of forex pairs to trade in the industry, with 330+ currency pairs available on our platform, so the forex market may present opportunities for traders worldwide. Whether you are trading minor, exotic or the most traded currencies, there is a forex trading strategy​ to suit every personality and trading style in order to make the most of market liquidity.

FAQs

Which currency pair is the most liquid?

According to a survey by the Bank of International Settlements (BIS), the most liquid currency pair is the EUR/USD, accounting for roughly 25% of daily forex trades. This isn’t surprising, given that the US and EU are also two of the world’s largest economies.

What are the best currency pairs to trade?

Some of the best currency pairs to trade may include the EUR/USD, GBP/USD, USD/JPY, and USD/CHF. This is because they have the highest liquidity and trade volume, as well as narrow spreads and low margin rates, which many traders find to be favourable in the FX market. However, it all depends on the strategy, timeframe, and risk/reward ratio you are planning to use. Learn more about major currency pairs.

What is the world’s strongest currency?

Some of the world’s most valuable currencies include the Jordanian dinar, British pound sterling, Swiss franc, Singapore dollar, and Bahrain dinar. Find out which is the strongest currency in the world in our guide to the top 16.


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CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.

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