Each currency pair has its own features and can be affected by various factors. It is important to know and understand these features, which should be taken in account while trading or investing. This is one of the Forex Trading Basics. Perhaps you’ll find that one of the pairs is more suited to your trading style than the other, in this case, just focus on the best option. Among the hundreds of available currency pairs you can always find one that is suitable to your needs and can meet your goals.

USD/JPY is the second most traded currency pair after The Euro-Dollar Currency Pair, with 13% of the daily trading volume according to BIS report. It is actively traded during the Asian Forex session and it has a small spread. The movements of the pair are smooth and it quickly reacts to a growing risk in financial markets. In such cases, the yen usually gets stronger against other currencies, because investors close their «carry trade» transactions.

The central bank is the Bank of Japan, which is interested in the low yen against other currencies, because Japan’s economy is highly dependent on exports. In the past there were occasions when the Bank of Japan invaded the Forex market and sold yens for U.S. dollars and Euros, thus supporting the national industries working for export.

GBP/USD is the third most liquid currency pair with 12% of the daily trading volume. It is usually called the “cable”. This pair is notable for its uncontrolled and over volatile movements, and it is definitely not recommended for beginners.

The British pound generally moves in the same direction as the EUR/USD, although this is not always the case. Since the pound has a higher interest rate, it is considered high-yielding currency. The Central Bank of the United Kingdom is the Bank of England.

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