How to select the Best Currency Pair for Investment?

I did a lot of research on different currency's but when you look at the spreads it just kills any edge, that's why I always traded eur/usd and eur/gbp ,but actually very few traded gbp when I first started, plus gbp traders tend to stay away from their own currency because of bias illusion.

I am in UK and I try to avoid GBP. Sometimes I feel that I understand the currency better because I am in the UK but I am too scarred that I am overly optimistic

I would generally recommend caution when trading with the GBP. I do trade EUR/GBP, but to be honest, I always feel pretty anxious about it.

That can be a problem when it is your own currency, that's why you have to stick to what the data is telling you ,not your own feeling, zero emotional attachment so you can trade in any direction. It is more volatile than eur/usd ,two ways to look at that ,is it opportunity or risk.

snapdragon1970 posted:
That can be a problem when it is your own currency, that's why you have to stick to what the data is telling you ,not your own feeling, zero emotional attachment so you can trade in any direction. It is more volatile than eur/usd ,two ways to look at that ,is it opportunity or risk.

Good point. That advice can be applied to pretty much anything and everything involved with Forex trading.

We the traders should choose the currency pair which is more appropriate to the concept of trading that will be used , if you depend on scalping should choose the pair which always ensures lowest comfortable trading spreads.

Imamul posted:
We the traders should choose the currency pair which is more appropriate to the concept of trading that will be used , if you depend on scalping should choose the pair which always ensures lowest comfortable trading spreads.

That pair is usually EUR/USD. It's volatility also makes it suitable for scalping.

Most volatile are least predictable.Based on historical data I favor AUDCAD and EURSEK.

argreen posted:
Most volatile are least predictable.Based on historical data I favor AUDCAD and EURSEK.

Why EURSEK, if I may ask?

argreen posted:
Most volatile are least predictable.Based on historical data I favor AUDCAD and EURSEK.

When I look at 4hr charts I fully agree with you that it is easy to predict the pattern of AUDCAD. But it is diffucult to predict EURSEK

Newcomers should choose the currency pair which is more appropriate to the concept of trading that will be used.

EUR/USD is the most profitable pair than other majors in my trading career. But as a newcomer I got confused because of its volatile trading spreads. But now I know how to keep pace with eur/usd.

Imamul posted:
EUR/USD is the most profitable pair than other majors in my trading career. But as a newcomer I got confused because of its volatile trading spreads. But now I know how to keep pace with eur/usd.

How do you keep pace with the pair? Do you scalp?

If you are a newcomer, I think you have to remove the tendency for earning money from here, and have to focus on just learning. Otherwise you can fall a great loss when you will try to earn money by trading.

Because of comfortable trading spreads I like most EUR/USD from all other major pairs. But I am not willing do depend on completely just one currency. For that reason in my demo account I usually trade all major currency pair to see the performance how it works. This approach always helps me for increasing my trading performance very rapidly.

According to me, frequently the most traded eight currency pairs have the largest liquidity and they are the most preferred trading pairs. As liquidity decreases spread increases. This enables only swing and medium term traders to trade successfully in the market. It is very difficult to do intraday or day trading in such pairs. Also, these crosses become volatile only when there is major news related to the base currency. Thus, a trader should also know about currency correlation before trading such Forex pairs.

Mohammadi posted:
Because of comfortable trading spreads I like most EUR/USD from all other major pairs. But I am not willing do depend on completely just one currency. For that reason in my demo account I usually trade all major currency pair to see the performance how it works. This approach always helps me for increasing my trading performance very rapidly.

Why do you like EUR/USD the most? The low spreads? The volatility?

TanEric posted:
Can anyone help me in knowing the best currency pairs for trading in the forex market? I am dilemma please help me or share any link which could help me in knowing that.

Hi @TanEric

You can easily choose the best currency pair

- Start the discussion on active forums
- Join groups and communities in social media put you query
- Start Polls in Social Media
- Read discussions about the related question in forex forums

There are some websites that have currency pair heat maps. You can see which currencies are strenghening and which are weakening. You can then trade the strongest against the weakest and these should trend nicely.