If you’re a new trader or a forex trading beginner specifically, you’ve probably seen names like EUR/USD or GBP/JPY in the community. These aren’t just random strings of letters, but refer to currency pairs. The most popular or frequently traded pairs are what we refer to as the major currency pairs.
Let’s break down what the major currency pairs in forex are and why they matter.
What Are Major Currency Pairs?
In forex trading, you’re always trading one currency against another. That’s why you see pairs like EUR/USD, which is the euro versus the US dollar. The first currency is called the base currency, and the second is the quote currency.
You’re basically looking at how much of the second currency it takes to buy one of the first.
The major currency pairs (คู่ สกุล เงิน หลัก) are the most traded combinations in the world, involving the US dollar (USD) paired with another major economy’s currency. These are:
EUR/USD (Euro vs. US Dollar)
It’s the most traded and usually the most stable pair. If you’re a beginner, this pair is the best to start with for its low volatility and tight spreads.
USD/JPY (US dollar vs. Japanese Yen)
This pair often moves in response to global risk sentiment and remains a favorite among traders seeking a safe haven. It’s also popular for its high liquidity.
GBP/USD (British Pound vs. US Dollar)
Also called the “Cable,” this pair is a bit more volatile, but the big risks come with big price movements. It can be a good trade in times of economic uncertainty in the UK.
USD/CHF (US Dollar vs. Swiss Franc)
Switzerland has a relatively stable economy, and this “Swissie” pair is the go-to in uncertain times. Much like the Japanese Yen, the Swiss Franc is often seen as a safe-haven currency.
AUD/USD (Australian Dollar vs. US Dollar)
Closely tied to commodities like gold and ore, it’s a popular pair for traders who follow resource markets.
USD/CAD (US Dollar vs. Canadian Dollar)
This pair is mostly influenced by oil prices, considering Canada is a major exporter of oil. When crude rises, CAD usually strengthens.
NZD/USD (New Zealand Dollar vs. US Dollar)
Similar to AUD/USD, this pair is one of the “commodity pairs” and is connected to dairy products – since New Zealand deals with agricultural exports.
Why They Matter
These pairs cover most of the forex trading volume worldwide. But there are solid reasons why they dominate the market and matter, including:
High Liquidity
You can open and close trades instantly because millions of transactions happen every second. This high liquidity means smaller spreads and smoother price movements, which is perfect for active traders.
Lower Trading Costs
Since these pairs are heavily traded, brokers usually offer tighter spreads. So, you lose less money to transaction costs and keep more of your profit.
Reliable Price Action
Major currency pairs tend to move more predictably compared to other pairs. The price swings are steady, making technical analysis and pattern recognition easier.
Lynn Martelli is an editor at Readability. She received her MFA in Creative Writing from Antioch University and has worked as an editor for over 10 years. Lynn has edited a wide variety of books, including fiction, non-fiction, memoirs, and more. In her free time, Lynn enjoys reading, writing, and spending time with her family and friends.
