Do You Know Your Currency Pairs?

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Before learning to trade in the Forex market, you have to know the fundamental analysis. Fundamental analysis refers to variables that influence a currency pair’s price. In addition to doing technical analysis on the basis of the charts and indicators, it is important to be mindful of the currency movements that can impact a currency pair as well.

1. Europe – Euro

This currency is rather new. It began trading in 1999; however, the EURO/USD pair is the most traded. Because of this, the EURO/USD is very liquid. The euro is greatly affected by interest rates. If you are trading the EURO/USD pair, you must pay attention to the Euribor (Europe’s three-month interest rate), to watch for any changes in investor reactions when trading the EURO/USD pair since the Usd and Euro rates affect each other. The EURO/USD is my personal favorite pair because of the many opportunities it gives for potential trades.

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