These Are The Best Forex Pairs To Trade

 one of the top questions that I get from Forex Traders is how to choose the best currency pairs to trade whether newbie or Season Pro this is a great chance to ensure you're trading the currency pairs that are just right for you hello everyone I'm Kathy lean with BK Traders and I want to welcome all of you back to our channel in today's video we will break down how to select the best Forex pairs to trade in three simple steps but before we get into it if you're completely new you really should be looking at trading just the euro dollar the Euro US dollar currency pair is the most liquid currency pair in the world which means it has the tightest spreads as the most orderly price movements it is the one that's written about the most and there's plenty of information explaining every single day what's going on in the Euro Zone and the us and why the euro is Upp or down if you want to start with one currency pair and learn it well it should be the euro dollar if you're ready to expand your horizon you're looking for more opportunities Beyond beyond that one currency pair then let's get started by the way if you don't want to miss valuable trading tips like this make sure you subscribe to our Channel and hit the notifications button for updates step number one consider your own personal risk tolerance between the major forx pairs in the crosses there are more than 25 actively traded pairs to choose from and they're all different some pairs like euro dollar and dollar CAD tend to have more orderly predictable movements they're great for Traders who prefer a steadier Market they move slower they have fewer gaps they have less volatile Trends and nice continuations I personally feel that they're easier and less stressful to trade however if you thrive on volatility on faster moves and deeper Trends and you feel that you can actually handle these swings then you might want to look at the British pound and its crosses Sterling always moves faster and further than the Euro especially when we have a rally or sell-off in the US dollar stering crosses like pound Yen pound Aussie are known for their volatility and offer even bigger moves I personally avoid trading all Sterling crosses except for Euro pounds because they're just too volatile for my own appetite and my stops however I love to trade euroc crosses like Euro ay and Euro kiwi and I love to trade Swiss and CAD crosses they can have more volatility but they also trade very well on fundamental or relative strength or weakness plays so the first step is to choose the pairs that align with how much risk you're willing to take on step number two think about what times of day you can trade because this will have a significant impact in determining what pairs will actually move during your trading session and what you should actually trade if you're trading during the Asia session for example and I will tell you my best trades are during the Asia session you'll find that the Australian dollar New Zealand dollar and Japanese Yen are the most active these currencies see more movements because they their own markets are open and that provides more trading opportunities more participation more volatility that's also the time of day when these countries tend to release their economic data which can provide a further Catalyst for movement during the Asia session my favorite currency pairs of trade are Euro Aussie Euro kiwi Aussie Swiss kiwi Swiss Aussie Cad and kiwi CAD I'll trade the Euro pairs if I am very confident about the trade and I want faster quicker movements these are usually resolved fairly quickly I find that if it's a trending night they can move as much as 50 Pips in the hour two after the Tokyo open if I'm feeling a little less confident or I'm looking for slower trades to carry overnight I'll opt for the Swiss or CAD crosses against the commodity currencies now if you're tring a European session all of the Euro costes from euro dollar euro pound the Euro Swiss and the Euro against commodity currencies will move the same is true for the British pound pairs so those are the ones you want to be looking at if you're trading the US session you have a wider range of active pairs to choose from but the best pairs to trade are typically the ones against the US dollar for the most part however all of the major currency pairs are fair game during this time because it is also the most active period of the day I personally love to trade euro dollar dollar Yen dollar Swiss and dollar CAD during the early us session which is before the US Equity Market open the last step is to decide whether you want to trade strong versus weak currencies or keep it simple by focusing on the US dollar Outlook and risk appetite if it is a big day in the stock market up or down then the best Forex pairs to trade should be the ones that include the US dollar or the Japanese Yen for example if stocks are down a lot there's a good chance that the US dollar and the Japanese Yan will rise in value against Euro Sterling the Australian New Zealand dollars a stocks are up a lot we're talking about triple digits here there's a good chance the dollar and the Yen will be trading low versus the Euro Sterling the Australian and New Zealand Dollars now of course to given in any given day there could be specific data or event risk to those countries that creates some sort of Divergence but it's a good rule of thumb generally speaking this is a more straightforward approach where you can base your trades on the overall strength and weakness of the US dollar this can simplify your analysis and help you stay focused alternatively you might want to look for strong versus weak currency pairs such as a pairing a strong Euro with a weak Australian dollar this strategy requires a little bit more analysis but can be very rewarding if done correctly a good tip for this is to look at the economic calendar that just came out what came out overnight or in the morning if there's a very strong or weak piece of data for one country and nothing from the other and the currency is reacting the way it should instead of ignoring the data there could be some nice continuation moves to sum it up choosing the right Forex pairs boils down to understand understanding your risk tolerance knowing when you can trade and deciding on your trading strategy if you're just starting out I recommend sticking with one or two currency pairs learn them well understand how they behave against the US dollar how they interact with each other the times a day they're the most active and which pieces of economic data actually impact them the most I hope you enjoyed this video thanks for watching if you found this video helpful don't forget to like subscribe and hit the notification Bell for more trading tips happy at trading everyone I will see you next time