Economy
The Best Forex Pairs to Trade For Beginners in 2023: Experts’ Recommendations
If you’re new to Forex trading and want to know which currency pairs are good for trading in 2023, you’re in the right place! Traders Union (TU) experts have created a list of the best Forex pairs for beginners. They’ll explain what makes a currency pair good for trading, so you can start your Forex journey on the right path. Whether you want stability, liquidity, or volatility, the experts will guide you to the best Forex pairs to trade.
Currency pairs
TU’s analysts consider that understanding currency pairs is crucial for anyone new to Forex. These pairs, also called trading pairs, are used to exchange one country’s money for another. Each pair has two assets: the base currency and the quote currency. For example, in EUR/USD, the euro (EUR) is the base, and the U.S. dollar (USD) is the quote. The exchange rate informs you of the amount of the quoted currency required to purchase a single unit of the base currency. Currency pairs are always traded in pairs because one currency’s value depends on another.
Currency pairs categories
Currency pairs in the Forex market fall into three main categories: major pairs, crosses, and exotic pairs. According to analysts at Traders Union, you should be aware of the following information:
- Major currency pairs:
These are the most traded pairs, always including the U.S. dollar.
Examples include EUR/USD, USD/JPY, and GBP/USD.
Traders like them for high liquidity and tight spreads.
They reflect the strength of the U.S. dollar and react to global events.
- Cross currency pairs:
Also known as minor pairs, they don’t involve the U.S. dollar.
Examples are EUR/GBP and GBP/JPY.
Traders use them to speculate on major currency relationships.
While spreads can be wider, they offer trading opportunities based on regional insights.
- Exotic currency pairs:
These pairs mix major currencies with emerging or thinly traded currencies.
Examples include USD/SGD and EUR/TRY.
Exotics have lower liquidity, wider spreads, and higher volatility.
Experienced and risk-tolerant traders may find profit potential but need thorough research and risk management.
Keep in mind that different brokers and traders may slightly vary in how they classify these currency pairs.
Top currency pairs for beginner traders in Forex
For beginners in Forex trading, TU’s experts recommend starting with certain currency pairs that offer excellent learning and trading opportunities.
- EUR/USD
This pair combines the euro and the US dollar and is the most traded currency pair globally. It boasts low spreads, high liquidity, and stability, making it attractive for traders.
- USD/JPY
Pairing the US dollar with the Japanese yen, USD/JPY is driven by the yen’s influence in Asia and the dollar’s global prominence. It provides ample liquidity and narrow spreads.
- GBP/USD
Known as “Cable,” this pair includes the pound sterling and the US dollar. It represents a significant share of daily Forex transactions and is influenced by the relative strength of the British and American economies.
- AUD/USD
Pairing the Australian dollar with the US dollar, AUD/USD is influenced by commodity exports, especially metals and minerals. Interest rate differentials between Australia and the US also play a role.
- USD/CAD
Representing the US dollar against the Canadian dollar, USD/CAD is considered a commodity pair, closely tied to oil prices and economic indicators of both countries.
- USD/CHF
Combining the US dollar with the Swiss franc, USD/CHF is known as “Swissie” and is the seventh most traded currency pair worldwide. The Swiss franc’s value is influenced by the Swiss National Bank’s actions and economic data from Switzerland. Switzerland’s reputation for financial stability makes the CHF a popular safe-haven currency.
Conclusion
If you’re a newcomer to Forex trading, Traders Union has provided valuable insights into the best currency pairs for beginners in 2023. Understanding these pairs is fundamental, as they’re used to exchange one currency for another. Starting with the recommended pairs in this article, beginners can embark on their Forex journey with confidence and learning opportunities.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange closed higher by 1.41 per cent on Friday, May 15, supported by four securities on the platform.
During the session, FrieslandCampina Wamco Plc added N14.24 to its share price to sell for N159.00 per unit, in contrast to the previous day’s N144.76 per unit.
Further, Central Securities and Clearing System (CSCS) Plc appreciated by N1.34 to N72.34 per share from N71.00 per share, Geo-Fluids Plc improved its price by 4 Kobo to N2.94 per unit from N2.90 per unit, and Industrial and General Insurance (IGI) Plc gained 1 Kobo to trade at 61 Kobo per share compared with Thursday’s closing price of 60 Kobo per share.
As a result, the NASD Unlisted Security Index (NSI) rose by 58.20 points to 4,188.41 points from 4,130.21 points, and the market capitalisation soared by N34.82 billion to N2.506 trillion from N2.471 trillion on Thursday.
During the session, the volume of trades went up by 180.8 per cent to 1.2 million units from 417,349 units, and the value of transactions increased by 29.8 per cent to N29.8 million from N23.2 million, while the number of deals fell by 22.6 per cent to 24 deals from 31 deals.
Great Nigeria Insurance (GNI) Plc ended the day as the most traded stock by value on a year-to-date basis with 3.4 billion units sold for N8.4 billion, followed by CSCS Plc with 60.8 million units exchanged for N4.1 billion, and Okitipupa Plc with 27.9 million units valued at N1.9 billion.
GNI Plc also closed the session as the most traded stock by volume on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by Resourcery Plc with 1.1 billion units transacted for N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units traded for N1.2 billion.
By Dipo Olowookere
The bears overpowered the Nigerian Exchange (NGX) Limited on Friday, sinking it further by 0.76 per cent when the closing gong was struck by 4 pm.
The nation’s flagship equity market was under selling pressure during the session, as investors booked profits after the shares witnessed price appreciation in the past trading sessions.
The energy sector was the most impacted, as it shed 4.43 per cent. The consumer goods index declined by 0.90 per cent, the banking counter decreased by 0.15 per cent, and the industrial goods sector lost 0.08 per cent, while the insurance counter gained 2.42 per cent, which was not enough to salvage the situation.
Consequently, the All-Share Index (ASI) contracted by 1,912.19 points to 250,330.92 points from 252,243.11 points, and the market capitalisation moderated by 1.225 trillion to N160.444 trillion from N161.669 trillion.
Zichis was the worst-performing stock for the session after it gave up 9.97 per cent to close at N29.43, FTN Cocoa slipped by 9.95 per cent to N8.96, The Initiates slumped by 9.90 per cent to N32.30, LivingTrust Mortgage Bank tumbled by 9.88 per cent to N3.83, and International Energy Insurance dropped 9.71 per cent to trade at N2.79.
The best-performing stock was ABC Transport, which grew by 10.00 per cent to N6.27. May and Baker also appreciated by 10.00 per cent to N47.30, SCOA Nigeria surged by 9.98 per cent to N33.05, Trans-Nationwide Express expanded by 9.97 per cent to N7.06, and DAAR Communications jumped 9.76 per cent to N2.25.
Yesterday, investors traded 1.1 billion shares worth N44.3 billion in 65,744 deals compared with the 1.0 billion shares valued at N41.6 billion transacted in 74,822 deals a day earlier. This indicated a dip in the number of deals by 12.13 per cent, and a rise in the trading volume and value by 10.00 per cent and 6.49 per cent, respectively.
Chams was the busiest equity for the day, with 328.5 million units sold for N1.1 billion. UBA traded 61.6 million units worth N2.7 billion, First Holdco transacted 58.7 million units valued at N4.2 billion, Secure Electronic Technology exchanged 51.9 million units worth N45.0 million, and Access Holdings traded 51.8 million units valued at N1.3 billion.
By Adedapo Adesanya
The last trading session of the week at the Nigerian Autonomous Foreign Exchange Market (NAFEX) ended on a negative note for the Naira on Friday, May 15, as it lost N15 Kobo or 0.1 per cent against the Dollar to trade at N1,371.04/$1 compared with the previous day’s N1,370.89/$1.
However, it further appreciated against the Pound Sterling in the same market segment yesterday by N20.77 to close at N1,830.61/£1 versus Thursday’s value of N1,851.38/£1, and gained N7.91 against the Euro to settle at N1,595.07/€1 versus N1,602.98/€1.
At the GTBank FX desk, the Naira lost N2 against the US Dollar during the session to sell at N1,383/$1 compared with the preceding session’s N1,381/$1, and at the black market, it remained unchanged at N1,385/$1.
The Naira is forecast to be broadly stable, supported by Dollar sales by the Central Bank of Nigeria (CBN) amid steady, higher oil receipts, with the market settling into a balance.
Policy direction is also expected to give the market some boost as the CBN said the new edition of the FX market guidelines will deepen liquidity, improve transparency and strengthen confidence in the country’s foreign exchange market.
According to the Governor of the CBN, Mr Yemi Cardoso, the update is due to changing global economic realities, domestic reforms and the need for a more coherent and forward-looking regulatory framework. According to him, the last edition of the FX manual was issued in 2018, making the latest review both timely and necessary.
Meanwhile, the cryptocurrency market plunged into the red zone as rising bond yields hit risk assets across markets, while traders are increasingly betting the Federal Reserve may need to raise rates again. Rising energy prices and resurging inflation could force central banks back into tightening mode.
Cardano (ADA) shrank by 4.4 per cent to $0.2557, Dogecoin (DOGE) slid by 3.7 per cent to $0.1104, Ripple (XRP) depreciated by 3.5 per cent to $1.41, Solana (SOL) crashed by 3.5 per cent to $87.81, and Binance Coin (BNB) slumped by 3.4 per cent to $659.64.
Further, Bitcoin (BTC) declined by 2.6 per cent to $78,547.49, Ethereum (ETH) lost 2.1 per cent to quote at $2,209.19, and TRON (TRX) tumbled by 0.7 per cent to $0.3509, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.
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