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  1. #1
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    Re: What criteria to pick wihch currency pair to trade

    Im not sure what you are looking for in a currency pair, but here are some facts that will help you get a good idea about the majors:

    Fast moving currency pairs:

    GBP/USD and USD/CAD

    Slow currency pairs:

    AUD/USD, NZD/USD and USD/JPY

    Moderate pairs:

    EUR/USD and USD/CHF

    Hope this helps.

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  3. #2
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    Re: What criteria to pick wihch currency pair to trade

    There are two main criteria in my opinion:
    1) If the pair has more tendency to range or trend in big moves during the day
    2) What is the average spread in the day time you strategy runs

    I think this is all you need to consider (or at least I do it).

  4. #3
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    Re: What criteria to pick wihch currency pair to trade

    Normally i will choose the most active currency pairs. It is because of high liquidity which means your stops will more often be met without slippage. The cost will be likely to be low. For me i choose EUR/USD and USD/JPY.
    I think everyone is free to choose their own currency pair they are comfortable with.

  5. #4
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    Re: What criteria to pick wihch currency pair to trade

    Pair dynamics change throughout the year - what is true today regarding ranging/trending may not be true in 3 months.

  6. #5
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    Re: What criteria to pick wihch currency pair to trade

    The criteria I use to determine what currency to trade is volatility (ADR) and spread. I tend to stick with pairs with a spread less than 4 and an ADR greater than 150.

  7. #6
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    Re: What criteria to pick wihch currency pair to trade

    The following currency pairs have greater than 150 average daily trading range: USD/CHF, USD/JPY, EURSD, GBP/EUR, GBP/JPY, CHF/JPY

  8. #7
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    Re: What criteria to pick wihch currency pair to trade

    US Dollar is the most important currency in the global economy. It is heavily traded against other currencies like Euro, British Pound, and Yen etc. Many trader trade currency pairs involving USD. They make the mistake of only studying US Dollar while ignoring the other currency in the pair. This neglect of the second currencys economic conditions can greatly hinder the profitability of the trade. This neglect also makes the odds of a loss high. When we trade against a strong economy, the chances of failure are more. The weak currency in the pair could flop badly while the strong currency in the pair may appreciate more than what you calculated.
    While choosing a currency pair to trade, one should study the economies of both the currencies. Finding the strong economy/weak economy pairing is the best strategy to use when maximizing returns.

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    Re: What criteria to pick wihch currency pair to trade

    I look for reasonable volume and volatility on a major currency pair. I trade the GBPUSD mainly and as back up the EURJPY and GBPJPY. Typically I find enough pips each day just on the GBPUSD

  10. #9
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    Re: What criteria to pick wihch currency pair to trade

    If you choose currency pairs with high liquidity (trading volumes are high), you will enjoy better files and avoid slippages. There is a saying in trading that " LIQUIDITY is the KING" .

    FYI, there are only 9 Pairs in Forex that are considered Liquid and 90% of All Forex trading occur on those 9 Pairs.

    EURUSD, GBPUSD, USDCHF, USDJPY, AUDUSD, USDCAD, EURJPY, EURGBP, EURCHF

    One currency pair that has low liquidity and subject to high slippage is the AUD/NZD.
    Hope this helps.

  11. #10
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    Re: What criteria to pick wihch currency pair to trade

    i would prefer the tightest/lowest spreads which usually is eur/usd and aud/usd as the beginner for test your signal, other higher pips spread may take time to break even.

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