Most Traded Currencies in FOREX

There are several authorized currencies that are utilized in the entire world but there are some most popular currencies that are exchanged dynamically in the foreign exchange market. In the trading of the currency, only the liquid currencies and most politically or economically stable currencies are required in ample numbers. In the FOREX market, currencies are always exchanged in pairs. The pairs contain an exclusive memo that states what currencies are being exchanged. The figure for a pair of currency will be in the form of ABC/DEF.

Currencies are exchanged in the amounts of dollar known as ‘lots’. One group is equivalent to $1,000 which means $100,000 in currency. For example – according to the strength and size of the US country, the American dollar is the most dynamically exchanged currency in the world. The need for the United States dollar symbolized a quick comparison with the Iraqi dinar which is not in order because of the economic and political volatility of that area.

There are 8 most exchanged currencies in the world and they include:-

USD – the US dollar
CAD – the Canadian dollar
EUR – the euro
GBP – the British Pound
CHF – the Swiss Franc
NZD – the New Zealand dollar
AUD – the Australian dollar
JPY – the Japanese Yen

Scientifically, there are about 27 different pairs of currency and out of them 8 currency pairs are considered to be the most popular. However, there are 18 such pairs of currency that are traditionally cited by the creators of the foreign exchange market as a consequence of their general liquidity. Some of these pairs include:-

USD/CHF
AUD/USD
AUD/CAD
EUR/JPY
CHF/JPY
GBP/CHF
AUD/NZD
EUR/CAD

One cannot trade their currencies alone. It is to be remembered that currencies can be exchanged in pairs only. One has to evaluate one currency with the other currency to make a deal probable.

All the pairs of currency appear like a fraction. The numerator is known as the basecurrency and the denominator is known as the counter currency. When one is giving an order to purchase one of the pair say one is really purchasing the EUR and selling the USD.

In the same way, if one is selling the pair, then they have to sell the EUR and purchasing the USD. Therefore, if one is purchasing or selling a pair of currency, one is purchasing or selling the base currency.