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I’m often slightly baffled when writing educational forex articles as to why so many traders struggle to make consistent money in the forex markets. The irony is that most of them actually know quite a lot. The problem isn’t what they know, it’s what they don’t know that really matters. After spending 14 years working in trading, extracting money from the markets has become second nature for me. Not because of some magical indicator or secret strategy I possess, but because I understood how the real money actually trades. And that’s where most retail traders go wrong especially the newbies when they first try their hand at trading. Why Most Forex Traders Are Guessing Here’s a statistic that should make you sit up and listen:   ●  Bank traders account for roughly 5% of all forex traders   ●  Speculators make up the other 95%   ●  That 5% of bank traders controls around 92% of total FX volume Let that sink in. If you don’t understand how that 5% trades, then you’re not really trading, you’re guessing. Educated guessing, perhaps, but guessing all the same. Now, let me clear up one of the biggest myths about institutional traders. They do not sit there all day hammering the buy and sell buttons, scalping ten pips at a time to hit their daily targets. In reality, most of their activity is simply executing orders for clients, something commonly referred to as clearing the flow. They may process thousands of trades a day, but almost none of those are for their own book. How Bank Traders Actually Trade Forex When it comes to proprietary trading, the trades that actually matter, bank traders typically place two or three trades a week. That’s it. These are the trades they’re judged on at year-end. These are the trades that determine bonuses. And as you can imagine, they’re not taken lightly. Bankers like to brag about their bonuses, size does matter! So no, bank traders are not glued to five-minute charts, desperately scalping to “make their number.” They are methodical, patient, and highly selective. Trades are only placed when technical and fundamental conditions line up. That’s the part retail traders need to understand. Why Your Charts Are Probably Working Against You I’m often genuinely dumbfounded when new clients show me their charts. They’re usually littered with indicators, oscillators on top of oscillators, many of which lag price by three or four hours and frequently contradict each other. Trading like this is one of the fastest ways I know to demolish a trading account. Bank traders’ charts look nothing like this. In fact, they’re almost boring by comparison. All they want to know is:   ●  Where are the key levels?   ●  Where is price likely to react? That’s it. Indicators were designed to try and predict the market. Bank traders don’t need to predict it, they are the market. If you understand how they operate, indicators become largely redundant. Their technical analysis boils down to one thing: support and resistance. Clean charts. No clutter. No distractions. Just the levels that actually matter. Now, before anyone gets excited, I’m not going to go into precise entry techniques here, because they’re almost never where people think they are. Trendlines are simply reference points. Execution is a completely different conversation. The Real Driver: Fundamentals Where bank traders really earn the bulk of their money is through fundamentals. The fundamental backdrop of any currency is shaped by three major forces: 1. Economic data 2. Central bank policy 3. Political influence And this is why currency direction can sometimes look messy. When political noise contradicts central bank messaging, markets become choppy and directionless. But when political conditions are stable, central bank policy is clear, and economic data supports that policy, that’s when big, clean trends emerge. That’s what bank traders wait for. Mastering fundamentals is not easy. It’s complex, nuanced, and takes years to truly understand. But if you do understand it, you’re positioning yourself on the right side of long-term currency direction, which is where real money is made. Trading Economic Data (The Right Way) There is a huge amount of money to be made trading economic releases, but only if you do it properly. Two things are essential: 1. A deep understanding of how different data points affect currencies 2. The ability to execute trades decisively, without hesitation If you hesitate, the opportunity is gone. These are the same economic releases that central banks base policy decisions on. By following and trading them correctly, you’re not only staying aligned with monetary policy, but you’re also growing your capital at the same time. This is professional trading. Not gambling. Capital Management: The Part Everyone Ignores To trade successfully over the long term, you need a comprehensive capital management system. This isn’t optional, it’s your entire business plan. A proper system should:   ●  Protect capital during uncertain periods   ●  Allow for capital expansion when conditions are right   ●  Define risk-to-reward, position sizing, and exits in advance When this is in place, your only job while trading is identifying high-quality opportunities. The stress disappears. You’re no longer glued to screens, panicking over every tick. And here’s a reality check: most bank traders spend large parts of the day chatting on the desk, speaking with other traders, or heading out to lunch with brokers. They are not staring at charts all day. Neither should you be if you are trading smarter. Trading With the Market, Not Against It From there, it’s simply about understanding which strategies to apply, and when to apply them. Plenty of traders talk about “beating the bankers.” I’ve even seen entire books written on it. But that misses the point entirely. You don’t want to beat them. You want to join them. Trade with the market, not against it. Final Thoughts There are no miracle secrets in forex trading. No magic indicators. No robots that can truly adapt to a dynamic, global market. The future maybe going that way, but we are not there yet. Success comes from understanding how the major players analyse, trade, and manage risk. Get those foundations right, and you’re already miles ahead of most retail traders. At its core, making money in the markets is no different from any other business. Walmart and JP Morgan operate on the same principle; they just sell different products. Buy at wholesale prices. Sell at retail prices. Forex is not so different.

  ●  Precious metals gap up   ●  Chip stocks surge higher   ●  Non-farm payrolls on Friday Precious metals regain momentum Happy New Year. Markets are currently reacting to the events that unfolded in Venezuela over the weekend. Precious metals all opened with sizeable gaps to the upside this morning and pushed higher still as safe-haven flows pushed prices higher. Gold quickly reclaimed $4,400 per ounce after the opening bell, while silver managed to briefly claw its way back over $76 after closing below $73 last Friday. Platinum and palladium are once again extremely volatile at the start of the week, with wicks in both directions. Interestingly, copper is also up strongly this morning, touching $5.80 per pound and rapidly approaching a new record high. While the latest developments in Venezuela appear to be relatively contained for the time being, many investors will take any excuse they can get to pile on precious metals. Chip stocks surge While US futures are largely unchanged, a number of Asian stock exchanges also gapped up this morning. The Japanese Nikkei 225 opened for trading for the first time this year, after being closed last Friday, and wasted no time climbing higher thanks to gains in tech stocks, in line with the surge in chip stocks in the US last week. The broader Topix index rose straight to record highs as soon as the stock market opened for the day, as did the Korean Kospi index. Chip stocks are fully back in focus, with Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung undergoing huge spikes this morning, matching the surge in ASML Holding (ASML) last Friday. Conversations are once again turning to chip shortages, to the benefit of the companies vying to meet the incessant demand. Bitcoin stirs Cryptocurrencies are finally showing some signs of life, with Bitcoin electing to push back over $92,500 early this morning. Despite reaching a record high in 2025, Bitcoin’s performance last year was disappointing to say the least, culminating in a 6% loss overall. In a year where every major stock index hit record highs, to say nothing of the staggering rallies in precious metals, cryptocurrencies severely underperformed in comparison. The crypto industry impatiently awaits the Clarity Act, no doubt delayed by last year’s government closure, but the bill remains alive and well, if various insiders are to be believed. Crypto will need a new narrative to leverage at some point; progress on the regulation front might just be the ticket. Muted crude oil markets Difficult to speak of Venezuela without mentioning oil markets, but as mentioned above, the weekend’s events appear to be contained for now. Despite Venezuela’s position as an oil producing nation and as a founding member of OPEC, there has been very little reaction in crude markets so far. The South American nation sits on the largest, proven reserves of oil in the world, but its production output has fallen short of the big players for decades already, in large part due to poor management, dated infrastructure and a lack of investment. Taking Venezuela out of the picture is unlikely to shift supply/demand dynamics in a major way, as reflected in the lack of reaction in the Brent Crude index. The week ahead This week, for the first time in months, traders will be treated to a full schedule of US labour data. Wednesday presents the latest ADP employment change and JOLT survey, followed on Thursday by the usual jobless claims, but the big event of the week is of course the December NFP report, this time published on the first Friday of the month as intended. Predictions are currently standing at 57k new jobs and an unemployment rate of 4.5%. For many, the report will mark a return to business as usual. #Metals #NFP #Oil

What Is a Currency Pair? A currency pair is the quotation of two different currencies, where the value of one currency is expressed relative to the other. In forex trading, a currency pair shows how much of one currency is needed to exchange for one unit of another currency. In simple terms, a currency pair represents a comparison between two currencies rather than the standalone price of a single currency. This matters because currencies derive their value from economic strength, interest rates, and market confidence relative to other countries. Currencies within a pair are identified using standardized ISO currency codes. These internationally recognised three-letter codes ensure that each currency is clearly defined and consistently represented across the global forex market. How Does a Currency Pair Work? In the forex market, every transaction always involves two currencies at the same time. When one currency increases in value, the other currency in the pair must decrease in relative terms. This is because forex prices are based on an exchange relationship rather than a standalone valuation. To put it simply, a currency pair compares one currency against another. The first currency listed is known as the base currency, while the second is called the quote currency. The exchange rate shows how much of the quote currency is needed to equal one unit of the base currency. For example, the currency pair EUR/USD expresses the value of the euro relative to the U.S. dollar. If the value of the euro strengthens compared to the dollar, the exchange rate will rise. If the euro weakens, the exchange rate will fall. This is how relative value changes are reflected in forex prices. This structure matters because it explains why currencies cannot move independently in the forex market. Every change in price reflects shifting economic conditions, expectations, or sentiment between two economies at the same time. Examples of Currency Pair Exchange Rates A currency pair exchange rate is usually displayed as a single numerical value, such as 1.05928. This number represents how much of the quote currency is required to exchange for one unit of the base currency. In simple terms, it shows the relative value between the two currencies at that moment in time. For example, if EUR/USD is quoted at 1.05928, this means that one euro is equivalent to 1.05928 U.S. dollars. If you were to exchange 100 euros, you would receive 105.928 U.S. dollars based on that exchange rate. This example helps illustrate how the quoted price translates into a real-world currency conversion. The key reason why this is important to learn is because exchange rates provide a standardised way to compare currencies globally. Rather than assigning an absolute value to a currency, the forex market continuously updates how currencies are valued relative to one another. As a result, exchange rates act as a real-time reflection of global economic relationships. Because exchange rates are always expressed as pairs, every price movement reflects changes in supply, demand, or perception affecting both currencies involved. This paired structure is fundamental to understanding how the forex market operates. Types of Currency Pairs Exchange rates represent the relative value between two currencies from different countries, and their movements are influenced by a wide range of economic and market factors. Because not all currencies behave in the same way, the forex market groups currency pairs into different categories based on their characteristics, liquidity, and typical market behaviour. In simple terms, different types of currency pairs exist because some currencies are traded far more frequently than others. Pairs involving the world’s largest economies tend to attract more market participation, while those linked to smaller or developing economies may behave differently due to lower liquidity or regional influences. There are currently several recognised categories of currency pairs in the forex market. These include major forex pairs, minor and cross currency pairs, exotic currency pairs, as well as broader classifications such as G10 currencies, CEE currencies, BRICS and BRIICS, BRICS+, and crown currencies. Each category reflects a distinct combination of economic scale, market depth, and global relevance. This categorisation matters because it helps market participants focus on currency pairs, they understand best. By recognising how different currency pair types behave, it becomes easier to interpret exchange rate movements and place them into a broader market context. Major Forex Pairs Major forex pairs are the most widely traded currency combinations in the global foreign exchange market. These pairs typically involve the world’s largest and most economically influential countries, which results in high levels of market participation and liquidity. In simple terms, major currency pairs are popular because they are traded frequently and attract a broad range of participants, including banks, corporations, governments, and institutional investors. Their high trading volume helps ensure that prices are formed efficiently and reflect global supply and demand conditions more accurately. Major forex pairs are often viewed as a benchmark for overall market activity. Movements in these pairs can offer insight into global economic trends, risk sentiment, and shifts in monetary policy expectations. There are seven currency pairs commonly recognised as major forex pairs in the global market: EUR/USD USD/JPY GBP/USD USD/CHF AUD/USD USD/CAD NZD/USD These pairs form the core of forex market activity and are often the first reference point for understanding how currency markets operate. EUR/USD EUR/USD is the most actively traded currency pair in the forex market and represents the exchange rate between the euro and the U.S. dollar. It reflects the economic relationship between the euro area and the United States, two of the world’s largest and most influential economic regions. In simple terms, this pair is closely watched because it combines high liquidity with broad global participation. As a result, price movements in EUR/USD are often seen as a general barometer of global market sentiment and economic confidence. Because of its depth and transparency, EUR/USD is commonly perceived as one of the clearest and most widely followed currency pairs in the forex market. For this reason, it is often used as a reference point when observing broader currency market trends. USD/JPY USD/JPY represents the exchange rate between the U.S. dollar and the Japanese yen and is one of the most actively traded currency pairs globally. This pair reflects the economic relationship between the world’s largest economy and Japan, a major exporter with a long-established role in global finance. To put it simply, USD/JPY is often associated with shifts in global risk sentiment and monetary policy expectations. Movements in this pair can reflect changing views on interest rate differentials, economic growth, and broader market confidence. Because of its strong liquidity and sensitivity to macroeconomic developments, USD/JPY is generally perceived as a key indicator of market sentiment, particularly during periods of heightened global uncertainty. For this reason, it remains a closely observed pair within the forex market. GBP/USD GBP/USD represents the exchange rate between the British pound and the U.S. dollar and is one of the oldest and most well-known currency pairs in the forex market. It reflects the economic relationship between the United Kingdom and the United States, two major financial centres with long-established global influence. In simple terms, this currency pair is known for responding strongly to economic data, monetary policy expectations, and political developments in both countries. Changes in growth outlooks, inflation trends, or policy direction can all influence how this pair is valued over time. GBP/USD is generally perceived as a liquid but more reactive major currency pair, often displaying clearer directional movements during periods of heightened economic or political focus. For this reason, it is widely followed as a reflection of both UK and US economic conditions. The GBP/USD currency pair is known as the "Cable" because of the transatlantic telegraph cablelaid in the 19th century that was used to transmit the exchange rates between the British pound and the US dollar. USD/CHF USD/CHF represents the exchange rate between the U.S. dollar and the Swiss franc. This pair reflects the relationship between the United States and Switzerland, with the Swiss franc historically associated with financial stability and a strong banking sector. In simple terms, USD/CHF is often linked to changes in global risk perception and monetary policy expectations. Shifts in confidence, interest rate outlooks, or broader economic uncertainty can influence how this pair is valued relative to other major currencies. USD/CHF is generally perceived as a more defensive major currency pair, particularly during periods of market stress. For this reason, it is closely observed when investors reassess risk and capital preservation across global markets. AUD/USD AUD/USD represents the exchange rate between the Australian dollar and the U.S. dollar. This currency pair reflects the economic link between Australia, a major exporter of natural resources, and the United States, the world’s largest economy. To put it simply, AUD/USD is often influenced by global economic conditions and demand for commodities. Changes in economic growth expectations, trade activity, and broader market confidence can affect how this pair is valued over time. AUD/USD is generally perceived as a currency pair that reflects global growth sentiment. For this reason, it is commonly observed as an indicator of how market participants view economic expansion and international trade conditions. USD/CAD USD/CAD represents the exchange rate between the U.S. dollar and the Canadian dollar. This pair reflects the close economic relationship between the United States and Canada, which are major trading partners with deeply interconnected economies. In simple terms, USD/CAD is often influenced by economic conditions in North America as well as shifts in global demand for energy and raw materials. Changes in growth expectations, trade flows, and broader market sentiment can all affect how this pair is valued. Read more：What Is Market Sentiment? Definition, Indicators and Strategies USD/CAD is generally perceived as a major currency pair that responds to both macroeconomic data and regional economic developments. For this reason, it is widely monitored as an indicator of economic dynamics within the North American region. NZD/USD NZD/USD represents the exchange rate between the New Zealand dollar and the U.S. dollar. This pair reflects the economic relationship between New Zealand, a smaller open economy with strong trade links, and the United States. To put it simply, NZD/USD is often influenced by global economic conditions, agricultural trade, and shifts in overall market confidence. Changes in international growth expectations and trade-related developments can affect how this pair is valued relative to other major currencies. NZD/USD is generally perceived as a major currency pair that reflects global growth sentiment, similar to other commodity-linked currencies. For this reason, it is commonly observed as an indicator of broader economic optimism or caution in international markets. Major Currency Pair Reference Table The following table provides a clear reference for the major forex pairs, showing the countries involved and commonly used market terminology. This overview helps reinforce how each major pair represents an economic relationship between two leading global economies. Currency Pair Countries FX Geek Speak EUR/USD Eurozone / United States Euro vs Dollar USD/JPY United States / Japan Dollar Yen GBP/USD United Kingdom / United States Cable USD/CHF United States / Switzerland Dollar Swiss AUD/USD Australia / United States Aussie USD/CAD United States / Canada Dollar Loonie NZD/USD New Zealand / United States Kiwi This table highlights why major currency pairs are often considered the foundation of the forex market. Their global relevance, liquidity, and familiarity make them a common reference point when analysing exchange rate movements. Minor and Cross Currency Pairs A currency pair made up of two major currencies that does not include the U.S. dollar is known as a cross-currency pair. These pairs are also commonly referred to as minor currency pairs, or simply “minors,” within the forex market. In simple terms, cross currency pairs allow exchange rates to be observed directly between two non-U.S. dollar currencies. While they may not be traded as heavily as major pairs, many crosses still attract significant market interest due to the economic importance of the countries involved. The most actively traded cross currency pairs typically involve major non-U.S. dollar currencies such as the euro, Japanese yen, and British pound. These currencies play a central role in global trade and finance, which helps support liquidity and consistent pricing across many cross pairs. Understanding minor and cross currency pairs matters because they reflect economic relationships beyond the influence of the U.S. dollar. As a result, their movements can offer additional insight into regional economic dynamics and relative currency strength. Euro Crosses Euro crosses are currency pairs that involve the euro and another major currency, excluding the U.S. dollar. These pairs highlight the euro’s relationship with other major economies and allow direct comparison without using the dollar as an intermediary. In simple terms, euro crosses can reflect regional economic differences within Europe as well as economic links between the euro area and other developed markets. Because the euro is one of the world’s most actively traded currencies, many euro crosses still benefit from relatively strong liquidity. Currency Pair Countries FX Geek Speak EUR/CHF Eurozone / Switzerland Euro Swiss EUR/GBP Eurozone / United Kingdom Euro Sterling EUR/CAD Eurozone / Canada Euro Loonie EUR/AUD Eurozone / Australia Euro Aussie EUR/NZD Eurozone / New Zealand Euro Kiwi EUR/SEK Eurozone / Sweden Euro Krona EUR/NOK Eurozone / Norway Euro Krone These euro cross pairs are often observed to understand how the euro performs against other major global currencies. As a result, they can provide additional perspective on regional economic conditions and cross-border capital flows. Yen Crosses Yen crosses are currency pairs that include the Japanese yen paired with another major currency, excluding the U.S. dollar. These pairs highlight how the yen is valued relative to other major economies without the influence of the dollar. To put it simply, yen crosses often reflect shifts in regional economic conditions, global risk perception, and differences in monetary policy expectations. Because the Japanese yen plays a central role in global finance, many yen crosses remain actively observed despite generally lower liquidity than major pairs. Currency Pair Countries FX Geek Speak EUR/JPY Eurozone / Japan Euro Yen GBP/JPY United Kingdom / Japan Pound Yen CHF/JPY Switzerland / Japan Swiss Yen CAD/JPY Canada / Japan Loonie Yen AUD/JPY Australia / Japan Aussie Yen NZD/JPY New Zealand / Japan Kiwi Yen These yen cross pairs are commonly used to gauge how the Japanese yen performs against other major global currencies. As a result, they can offer insight into changing market sentiment and international capital movement trends. Pound Crosses Pound crosses are currency pairs that involve the British pound and another major currency, excluding the U.S. dollar. These pairs reflect how the pound is valued relative to other developed economies without using the dollar as a reference point. In simple terms, pound crosses often respond to economic conditions and policy developments in the United Kingdom as well as in the paired country. Because the pound is a widely traded currency, many pound crosses continue to attract market attention despite generally lower liquidity than major pairs. Currency Pair Countries FX Geek Speak GBP/CHF United Kingdom / Switzerland Pound Swiss GBP/AUD United Kingdom / Australia Pound Aussie GBP/CAD United Kingdom / Canada Pound Loonie GBP/NZD United Kingdom / New Zealand Pound Kiwi These pound cross pairs help illustrate how the British pound performs against other major global currencies. As a result, they provide additional context for understanding regional economic conditions and relative currency strength. Other Crosses Other cross currency pairs consist of combinations of major currencies that do not fall neatly into euro, yen, or pound cross groupings. These pairs still exclude the U.S. dollar and reflect economic relationships between developed economies. In simple terms, these crosses allow market participants to observe how two non-U.S. dollar currencies perform directly against each other. While they may attract less attention than euro or yen crosses, they can still provide useful insight into regional economic conditions and relative currency strength. Currency Pair Countries FX Geek Speak AUD/CAD Australia / Canada Aussie Loonie AUD/CHF Australia / Switzerland Aussie Swiss AUD/NZD Australia / New Zealand Aussie Kiwi CAD/CHF Canada / Switzerland Loonie Swiss NZD/CHF New Zealand / Switzerland Kiwi Swiss These other cross currency pairs help broaden the overall view of how major currencies interact outside the influence of the U.S. dollar. As a result, they add depth to the understanding of global currency relationships. Understanding Cross Currency Rates Cross currency rates describe how one currency can be exchanged for another through an intermediary currency, rather than being quoted directly. In many cases, this intermediary currency is the U.S. dollar, due to its central role in global foreign exchange markets. To put it simply, if a direct exchange rate between two currencies is not readily available, their relative value can be determined by comparing each currency against a third currency. For example, the value of one currency relative to another may be inferred by using both currencies’ exchange rates against the U.S. dollar. This process helps ensure consistent pricing across the forex market. As a result, cross currency rates allow currencies to be compared efficiently, even when direct market quotes are limited or less actively traded. Exotic Currency Pairs Exotic currency pairs consist of one major currency paired with a currency from a developing or emerging economy. These currencies typically belong to countries with smaller financial markets or economies that are still evolving within the global system. In simple terms, exotic currency pairs reflect economic relationships between major economies and emerging markets. Their exchange rates can be influenced by local economic conditions, regional political developments, and changes in global risk sentiment. Common examples of countries whose currencies are often included in exotic pairs include Brazil, Mexico, Indonesia, Poland, Chile, Turkey, and Hungary. These currencies represent regions with growing economic importance, but different market characteristics compared to major currencies. Currency Pair Countries FX Geek Speak USD/BRL United States / Brazil Dollar Real USD/HKD United States / Hong Kong Dollar Hong Kong USD/SAR United States / Saudi Arabia Dollar Riyal USD/SGD United States / Singapore Dollar Singapore USD/ZAR United States / South Africa Dollar Rand USD/THB United States / Thailand Dollar Baht USD/MXN United States / Mexico Dollar Peso USD/RUB United States / Russia Dollar Ruble USD/PLN United States / Poland Dollar Zloty USD/CLP United States / Chile Dollar Peso These exotic currency pairs highlight the diversity of the global forex market. As a result, they help illustrate how exchange rates can reflect both global influences and country-specific economic conditions. Crown Currencies Crown currencies refer to the currencies of certain Nordic countries whose currency names are derived from the word “krona” or “krone,” meaning “crown.” These currencies belong to developed, stable economies with strong institutional frameworks and well-established financial systems. In simple terms, crown currencies reflect the economic conditions of Northern European countries that operate outside the euro area. Their exchange rates can be influenced by regional economic performance, central bank policy decisions, and broader European market trends. Country Currency Name Currency Code Denmark Danish Krone DKK Sweden Swedish Krona SEK Norway Norwegian Krone NOK These currencies add further diversity to the forex market by representing advanced economies that maintain independent monetary policies. As a result, crown currencies provide additional insight into regional economic dynamics within Europe. G10 Currencies G10 currencies refer to the currencies of ten of the world’s most heavily traded and economically influential nations. These currencies dominate global foreign exchange turnover and form the backbone of liquidity in the forex market. In simple terms, G10 currencies are widely used in international trade, finance, and investment. Their high trading volume and strong institutional support contribute to relatively transparent pricing and consistent market participation. Country Currency Name Currency Code United States U.S. Dollar USD Eurozone Euro EUR United Kingdom British Pound GBP Japan Japanese Yen JPY Australia Australian Dollar AUD New Zealand New Zealand Dollar NZD Canada Canadian Dollar CAD Switzerland Swiss Franc CHF Norway Norwegian Krone NOK Sweden Swedish Krona SEK Denmark Danish Krone DKK Because of their central role in global finance, G10 currencies are often used as benchmarks when analysing exchange rate movements. As a result, they play a key role in shaping overall forex market dynamics. CEE Currencies CEE currencies refer to the currencies of Central and Eastern European countries. These currencies represent economies that are closely connected to the European Union but, in many cases, operate outside the euro area and maintain independent monetary policies. In simple terms, CEE currencies often reflect regional economic performance, capital flows, and sensitivity to political or policy developments within Europe. Compared to major currencies, they may display different liquidity characteristics and can react more noticeably to regional economic changes. Country Currency Name Currency Code Hungary Hungarian Forint HUF Czech Republic Czech Koruna CZK Poland Polish Zloty PLN Romania Romanian Leu RON These currencies add an additional regional dimension to the forex market. As a result, CEE currencies help illustrate how exchange rates can reflect both local economic conditions and broader European trends. BRIICS BRIICS refers to a group of large emerging market economies: Brazil, Russia, India, Indonesia, China, and South Africa. These countries represent a significant share of global population, production, and long-term economic growth potential. In simple terms, currencies associated with BRIICS countries often reflect trends in emerging markets, including industrial growth, commodity demand, and sensitivity to global economic and geopolitical developments. Their exchange rates can highlight how capital flows respond to changing risk perceptions and economic expectations. Country Currency Name Currency Code Brazil Brazilian Real BRL Russia Russian Ruble RUB India Indian Rupee INR Indonesia Indonesian Rupiah IDR China Chinese Yuan (Renminbi) CNY South Africa South African Rand ZAR These currencies play an increasingly important role in the global forex landscape. As a result, BRIICS currencies help illustrate how emerging economies influence international currency markets and global economic balance. BRICS+ BRICS+ refers to the expanded group of countries that have formally joined the original BRICS bloc, broadening its economic and geopolitical reach. This expansion reflects growing cooperation among emerging and energy-producing economies outside traditional Western-led economic groupings. In simple terms, BRICS+ highlights a shift toward a more multipolar global economic structure. The currencies of these countries can reflect changing trade relationships, regional influence, and evolving patterns of global capital movement. Countries that have officially joined the BRICS+ group include Saudi Arabia, the United Arab Emirates, Iran, and Egypt. These nations add significant economic diversity, particularly through energy production, regional trade links, and strategic geographic positioning. As a result, BRICS+ currencies further illustrate how global currency markets adapt to changing economic alliances and long-term structural shifts in the world economy. Comparison of Currency Pair Categories The following table compares the main currency pair categories to provide a clearer reference for their general characteristics. This comparison highlights how liquidity, volatility, and market behaviour can differ across categories. Category Features Liquidity Volatility Advantages Disadvantages Suitable For Suitable Strategies Major Forex Pairs Most traded pairs involving USD and major economies Very high Generally lower Transparent pricing, deep markets Highly competitive, smaller price swings Broad market observation Long-term analysis, macro comparison Minor & Cross Currency Pairs Major currencies excluding USD High to moderate Moderate Regional insight, diversification Lower liquidity than majors Regional focus Comparative analysis Exotic Currency Pairs Major paired with emerging market currencies Lower Higher Exposure to emerging economies Wider spreads, higher sensitivity Market research Long-term economic observation G10 Currencies Currencies of top global economies Very high Lower to moderate Strong liquidity, global relevance Highly efficient pricing Market benchmarking Broad economic analysis CEE Currencies Central & Eastern European currencies Moderate Moderate Regional economic insight Sensitive to local events Regional monitoring Economic trend analysis BRICS / BRIICS Large emerging market currencies Variable Higher Growth exposure Geopolitical sensitivity Global diversification Structural analysis Crown Currencies Nordic non-euro currencies Moderate Moderate Independent monetary policy insight Smaller market size Regional focus Comparative analysis This comparison helps place each currency category into context. As a result, it becomes easier to understand how different currency groups contribute to the structure of the global forex market. Why Are Major Currency Pairs Popular in Forex Trading? Major currency pairs are widely used in the forex market because they represent the most actively traded and economically significant currency combinations in the world. Their popularity is driven by a combination of high trading volume, strong liquidity, and close links to major global economies. In simple terms, major currency pairs are often preferred because their pricing reflects a broad range of market participants and information. This makes their exchange rates easier to observe, compare, and interpret within the wider context of global financial markets. The following factors help explain why major currency pairs continue to dominate forex market activity. Highest Trading Volume Major currency pairs have exceptionally high trading volumes, which means they are exchanged frequently throughout the global trading day. This constant activity contributes to smoother price formation and more consistent market behaviour compared to less actively traded pairs. Involves Major Economies Major currency pairs typically involve the world’s largest and most influential economies. Because these economies play a central role in global trade and finance, their currencies are closely watched and widely used as benchmarks in international markets. Deep Market Liquidity High liquidity means there are many buyers and sellers participating in the market at any given time. For major currency pairs, this depth helps prices reflect supply and demand efficiently and reduces the likelihood of abrupt price distortions. Transparent Pricing Major currency pairs benefit from extensive market coverage and readily available economic information. As a result, their prices tend to be more transparent, with exchange rate movements reflecting well-documented economic data, policy decisions, and global events. Core Forex Pairs Taken together, these characteristics explain why major currency pairs are often regarded as the core of the forex market. They provide a foundational reference for understanding how currencies are priced and how global economic forces influence exchange rates. Advantages of Trading Currency Pairs Trading currency pairs offers several advantages that help explain why the forex market attracts participants from around the world. These advantages are closely linked to the structure of the market, its global reach, and the way exchange rates are quoted and accessed. The following sections outline some of the key benefits associated with currency pairs in the forex market. Traded 24 Hours a Day The forex market operates almost continuously throughout the week, following the opening hours of major financial centres in Asia, Europe, and North America. This near-round-the-clock structure allows exchange rates to update continuously as global economic activity unfolds. High Market Accessibility Currency pair pricing is relatively easy to follow, and market information is widely available. In addition, forex trading does not require the physical exchange or storage of assets, which contributes to its accessibility and flexibility for market participants. Clear Price Structure Exchange rates directly express the value of one currency relative to another. This clear structure makes currency pricing easier to interpret compared to some asset classes that rely on more complex valuation models or multiple underlying components. Wide Range of Currency Choices The forex market includes major, minor, and exotic currency pairs, offering exposure to a broad range of economies and regions. This diversity allows currency markets to reflect different economic conditions, growth profiles, and regional influences. Taken together, these advantages help explain why currency pairs form the foundation of the global forex market. As a result, they remain a central focus for understanding how international currencies interact. Disadvantages of Trading Currency Pairs While currency pairs offer many advantages, they also come with certain limitations that are important to understand. Exchange rates are influenced by a wide range of factors, which can introduce complexity and uncertainty into currency markets. The following sections outline some of the key challenges associated with trading currency pairs. High Price Volatility Exchange rates can experience significant price fluctuations, sometimes within short periods of time. Even major currency pairs may move rapidly in response to changing economic conditions or shifts in market expectations. News and Data Sensitivity Currency pairs are highly sensitive to economic data releases, central bank decisions, and major global events. Unexpected developments can lead to sharp movements in exchange rates, reflecting rapid changes in market sentiment. Multi-Economic Exposure Unlike assets linked to a single economy, currency pairs are influenced by two different countries at the same time. As a result, exchange rate movements reflect the interaction between two sets of economic conditions, policies, and market dynamics. Lower Profit Margins Major currency pairs often feature high liquidity and efficient pricing. While this contributes to transparency, it can also mean that individual price movements are relatively limited compared to less liquid currency pairs. Crowded Market Risk Because major currency pairs attract a large number of market participants, market behaviour can sometimes become highly synchronised. This can amplify price movements or contribute to sudden reversals when market expectations shift. Understanding these disadvantages helps place currency pair behaviour into context. As a result, it becomes easier to appreciate both the opportunities and limitations present in the forex market. What Factors Affect Major Currency Pair Exchange Rates? Major currency pair exchange rates do not move randomly. Their movements are influenced by a range of economic, political, and financial factors that shape how currencies are valued relative to one another. In simple terms, exchange rates reflect how market participants interpret current conditions and future expectations for two different economies. The following factors are among the most important influences on major currency pair movements. Interest Rates Interest rate policies set by central banks play a central role in influencing exchange rates. Differences in interest rates between countries can affect how currencies are valued, as monetary policy decisions shape economic conditions and financial expectations. Economic Data Reports Economic indicators such as employment data, inflation figures, and gross domestic product growth provide insight into a country’s economic health. Strong or weak data can influence confidence in a currency by shaping expectations about future economic performance. Politics and Global Events Political stability and policy direction can have a significant impact on exchange rates. Elections, policy changes, and geopolitical developments may influence market confidence and often affect multiple major currency pairs simultaneously. Market Sentiment Market sentiment reflects how participants collectively perceive risk and future prospects. Even in the absence of major data releases or events, shifts in sentiment alone can drive exchange rate movements across the forex market. Together, these factors help explain why currency values change over time. As a result, exchange rate movements can be better understood when viewed through a broader economic and market context. Read more：What Is Market Sentiment? Definition, Indicators and Strategies Why Currency Pairs Matter in Forex Trading Currency pairs are the core building block of the forex market. They are not only the basic unit used to quote prices, but also a direct reflection of how global capital flows between countries and economies. In simple terms, currency pairs show where money is moving and how economic strength is being re-priced in real time. Every change in an exchange rate reflects shifting expectations about growth, inflation, interest rates, or stability between two economies. When currency pairs are not properly understood, it becomes difficult to interpret what market movements actually represent. A price change may be misread as strength or weakness in one currency, without recognising the role the second currency plays in that movement. This matters because forex prices are always relative. Without a clear understanding of how currency pair’s function, exchange rate movements can appear confusing or contradictory. As a result, currency pairs serve as an essential framework for understanding how the global forex market operates. FAQ What is a currency pair in forex? A currency pair in forex is a quotation that shows the value of one currency relative to another. It represents how much of one currency is needed to exchange for one unit of another currency. How many currency pairs are there? There are dozens of currency pairs available in the forex market, including major, minor, and exotic pairs. The exact number can vary depending on market availability and classification. Which currency pairs are most suitable for beginners to trade? Major currency pairs such as EUR/USD, GBP/USD, and USD/JPY are generally considered easier to follow due to their high liquidity and transparent pricing. Exotic currency pairs may be less suitable for beginners because they often behave differently and have lower liquidity. What are the most volatile currency pairs in the forex market? Currency pairs involving smaller or emerging economies often experience higher volatility, especially during periods of economic or political uncertainty. Volatility levels can change over time depending on market conditions. What is the difference between major, minor, and exotic currency pairs? Major currency pairs involve the U.S. dollar and the world’s most traded currencies, minor pairs exclude the U.S. dollar, and exotic pairs include currencies from developing or emerging economies. Conclusion In conclusion, currency pairs form the foundation of the forex market and are essential for understanding how exchange rates are priced and interpreted. Every forex quotation represents a relationship between two economies, reflecting shifts in economic strength, confidence, and global capital flows. By understanding how different types of currency pair’s function and how their characteristics vary, market participants can better place exchange rate movements into context. This structured understanding helps clarify why currencies move as they do under different market conditions. Ultimately, currency pairs provide the framework through which the global forex market operates. A clear grasp of their structure and behaviour supports more informed observation and interpretation of currency markets as a whole. Try these Next What is margin trading and how it works in forex？ What is leverage and how it works in forex trading？ What Is the Spread in forex? Learn to Calculate and Trade It What is slippage and how to avoid it in trading What are pips in forex and how to calculate their value { "@context": "https://schema.org", "@graph": [ { "@type": "Article", "@id": "https://www.radexmarkets.com/en/News/NewsDetail?p=VUpPdVFmcTZFVjQ9", "headline": "What is a currency pair? 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One of the best quotes I recently heard about oil is by the legendary Tommy Norris (Google his name if you are not quite on the same page), it goes like this……. OIL. “Good and bad don't factor into this. Our great-grandparents built a world that runs on this stuff, right here. Until it starts running on something else, we got to feed it, or the world stops. There is an alternative. You can throw your phone away and trade that Mercedes in for a bicycle or a horse and start hunting your own food and living in a tent, but you'll be the only one and it won't make a damn bit of difference. Plus, I hear the moral high ground gets really windy at night.” If you trade forex and don’t pay attention to oil prices, you’re effectively ignoring one of the most powerful macroeconomic forces on the planet. Oil is not just another commodity ticking away on a chart, it is a foundational input for global growth, inflation, trade balances, and monetary policy. Currencies respond to economic pressure. Oil creates that pressure. When oil prices spike, inflation rises, costs surge, and central banks start paying attention. When oil prices collapse, entire economies wobble, currencies weaken, and producers start switching off supply. Forex traders who understand this relationship don’t just see price movement, they understand why it’s happening. In this article, we’ll explore why oil prices matter in forex trading, examine real-world examples of oil price spikes driven by global tensions, and explain what happens to oil production, and currencies, when prices fall below $60 per barrel. Why Oil Is So Central to the Global Economy Oil sits at the heart of modern civilisation. It fuels:   ●  Transport (cars, aviation, shipping)   ●  Manufacturing and heavy industry   ●  Agriculture and food production   ●  Heating, electricity, and plastics Because oil feeds into almost every layer of economic activity, changes in oil prices quickly affect:   ●  Inflation   ●  Consumer spending   ●  Business costs   ●  Government budgets Forex markets are forward-looking. They price what the economy will look like, not what it looks like today. Oil prices provide one of the clearest early signals of those future conditions. The Direct Link Between Oil and Forex Markets Forex traders focus on:   ●  Inflation trends   ●  Economic growth   ●  Trade balances   ●  Interest rates   ●  Capital flows Oil affects every single one of these. When oil prices rise, inflation usually follows. When inflation rises, central banks are pressured to tighten monetary policy. When policy tightens, currencies move. Oil doesn’t just influence forex indirectly; it sits right at the core of macro currency pricing. Oil Is Priced in US Dollars – A Critical Forex Mechanism One of the most important oil–forex relationships is with the US dollar. Oil is traded globally in USD, which means:   ●  Countries must buy USD to buy oil   ●  Rising oil prices increase global USD demand   ●  Falling oil prices can reduce USD liquidity flows This creates a powerful but often misunderstood link between oil and major currency pairs. During periods of high oil volatility, moves in:   ●  EUR/USD   ●  GBP/USD   ●  USD/JPY often accelerate as global capital adjusts to changing energy costs. Oil-Exporting vs Oil-Importing Currencies Oil price changes do not affect all currencies equally. Oil-Exporting Countries (Generally Benefit from Rising Prices) When oil prices rise, exporting nations often see:   ●  Higher export revenues   ●  Improved trade balances   ●  Stronger government finances   ●  Increased foreign investment This tends to support their currencies. Key oil-linked currencies include:   ●  Canadian Dollar (CAD)   ●  Norwegian Krone (NOK)   ●  Mexican Peso (MXN)   ●  Russian Ruble (RUB) Canada is the classic example. Oil exports form a significant part of the Canadian economy. When oil prices rise, USD/CAD often falls as CAD strengthens. Oil-Importing Countries (Often Hurt by Rising Prices) Countries that rely heavily on imported energy face rising costs when oil prices increase. This can:   ●  Push inflation higher   ●  Widen trade deficits   ●  Reduce consumer spending   ●  Pressure economic growth Currencies commonly affected include:   ●  Japanese Yen (JPY)   ●  Indian Rupee (INR)   ●  Eurozone currencies   ●  UK pound (to a lesser extent) Real-World Examples: When Global Tensions Caused Oil Price Spikes Oil price spikes are rarely random. They are usually driven by fear of supply disruption, not actual shortages. 1. Middle East Conflicts The Middle East controls a significant portion of global oil supply. Any escalation in the region sends shockwaves through energy markets. Examples include:   ●  Tensions involving Iran and the Strait of Hormuz   ●  Conflicts in Iraq and Syria   ●  Attacks on Saudi oil infrastructure Even the threat of disruption to the Strait of Hormuz, through which around 20% of the world’s oil passes, is enough to send oil prices sharply higher. For forex traders, these moments often create:   ●  Risk-off sentiment   ●  USD strength   ●  Volatility in oil-linked currencies like CAD and NOK 2. Russia–Ukraine Conflict Russia is one of the world’s largest oil and energy exporters. When the Russia–Ukraine conflict escalated:   ●  Sanctions restricted Russian energy exports   ●  Europe scrambled for alternative supplies   ●  Oil prices surged on supply fears This had immediate forex consequences:   ●  Energy-importing currencies weakened   ●  Inflation spiked across Europe   ●  Central banks were forced into aggressive tightening cycles Oil was a major transmission mechanism from geopolitics into forex markets. 3. OPEC and OPEC+ Political Tensions Oil price spikes also occur when OPEC unity fractures. Disagreements between major producers, such as Saudi Arabia and Russia, can:   ●  Reduce confidence in future supply   ●  Trigger speculative buying   ●  Create sharp, sudden price spikes OPEC meetings are effectively macro events for forex traders, especially those trading USD/CAD or emerging-market currencies. 4. Attacks on Energy Infrastructure Oil prices have spiked following:   ●  Drone attacks on Saudi facilities   ●  Pipeline sabotage   ●  Shipping disruptions Markets react instantly. Oil prices rise first; currencies adjust second. Why Oil Prices Collapse Oil prices can also fall dramatically, sometimes faster than they rise. 1. Global Economic Slowdowns When growth slows:   ●  Transport activity falls   ●  Manufacturing demand weakens   ●  Energy consumption drops Oil prices often act as an early warning sign of economic trouble. Forex markets take note. 2. Oversupply and Price Wars Oil producers don’t always coordinate well. Oversupply can occur when:   ●  OPEC members cheat on quotas   ●  New producers flood the market   ●  Shale oil output rises rapidly When supply overwhelms demand, oil prices don’t drift lower, they collapse. What Happens When Oil Falls Below $60 per Barrel? This is a critical level for both oil markets and forex traders. The $60 Threshold Matters While exact break-even levels vary, $60 per barrel is widely seen as a psychological and economic tipping point. Below this level:   ●  Many producers struggle to remain profitable   ●  Investment in new projects slows   ●  Supply growth begins to contract Impact on Oil Production When oil prices fall below $60: 1. High-Cost Producers Reduce Output Producers with higher extraction costs, such as shale oil and offshore drilling, may:   ●  Scale back production   ●  Delay new projects   ●  Shut down marginal wells This reduces future supply, often planting the seeds for the next oil price rebound. 2. Capital Investment Dries Up Oil production is capital intensive. Low prices mean:   ●  Fewer drilling projects   ●  Reduced exploration budgets   ●  Layoffs across the energy sector This doesn’t affect supply immediately, but it creates supply constraints later. 3. Government Budgets Come Under Pressure Many oil-exporting countries rely on oil revenue to fund public spending. Below $60:   ●  Budget deficits widen   ●  Currencies weaken   ●  Political risk can increase This is why prolonged low oil prices often coincide with weakness in CAD, NOK, and emerging-market currencies. Forex Implications of Sub-$60 Oil For forex traders, low oil prices usually mean: Oil-Exporting Currencies:   ●  Weaker exchange rates   ●  Reduced foreign investment   ●  Increased volatility Oil-Importing Currencies:   ●  Lower inflation   ●  Improved trade balances   ●  Potential currency support However, if oil falls due to a global slowdown, risk-off sentiment can overwhelm these benefits. Context always matters. Oil, Inflation, and Central Banks Oil prices feed directly into inflation. Rising Oil Prices:   ●  Push inflation higher   ●  Pressure central banks to hike rates   ●  Can support currencies if growth holds Falling Oil Prices: Reduce inflation pressures Allow dovish policy Can weaken currencies tied to energy exports Central banks watch oil closely, and so should forex traders. How Forex Traders Can Use Oil in Practice You don’t need to trade oil directly. Smart forex traders:   ●  Track WTI and Brent crude   ●  Watch oil during geopolitical escalations   ●  Monitor USD/CAD correlations   ●  Use oil as a macro confirmation tool   ●  Avoid trading oil-linked currencies blindly during oil shocks Oil provides context, it explains why currencies are moving. Final Thoughts: Oil Is a Macro Driver You Cannot Ignore Oil prices influence inflation, growth, trade balances, and central bank decisions, the foundations of forex pricing. Understanding oil won’t make you perfect but ignoring it will eventually make you wrong. Because when oil moves aggressively, forex markets rarely stay quiet for long. And a final word from our friend Tommy Norris: “We have a 120-year petroleum-based infrastructure. Our whole lives depend on it. And, hell, it's in everything. The roads we drive on The wheels on every car ever made, including yours. It's in tennis rackets and lipstick and refrigerators and antihistamines. Pretty much anything plastic. Your cell phone case, artificial heart valves. Any kind of clothing that's not made with animal or plant fibres. Soap, even hand lotion, garbage bags, fishing boats. You name it. Everything. And you know what the kicker is? We're gonna run out of it before we find its replacement.”

  ●  Silver hits $84   ●  Platinum touches $2,500   ●  Chaos in precious metals Precious metal pandemonium Silver, platinum and palladium are in complete chaos this morning, with all three metals exhibiting violent, double-digit price swings within hours of the market open. Silver reached all the way to $84 per ounce earlier today, before electing to explore lows of $75. Platinum briefly breached $2,500 at one point, only to dip back down to $2,200. Palladium is equally unstable. Gold has been practically stationary in comparison, incurring only a minor loss so far today. The rallies in precious metals achieved full-on hysteria last Friday, with silver, platinum and palladium all registering double-digit gains. Silver closed the week at $79 per ounce, meaning the white metal has gained $50 since the start of the year. There is no other way to describe the rise in silver other than parabolic, and yet the metal is not alone. Platinum started the year under $900 per ounce; it now stands above $2,400. Palladium, while not quite matching the outrageous performances of silver and platinum, has still doubled this year, from $900 in January to over $1,900 last week. Gold meanwhile had a relatively humble week, gaining around $200 by Friday and registering a fresh record high of $4,550 per ounce. Exuberance aside, some cracks are finally beginning to show for silver. Last week, Elon Musk said the situation in silver markets was “not good”, referring to the key role that silver plays in many industrial applications. The gap between supply and demand continues to widen as miners struggle to keep up, with deficits expected to persist in 2026. Meanwhile, the Chicago Mercantile Exchange has raised the margin requirement for silver futures from $20,000 to $25,000, starting from today. The move effectively limits the leverage on offer, forcing parties to either commit more capital or reduce position size. It is not the first time the CME Group has made such an adjustment, having also done so in 1980 and 2011, among other times. The salient point about the 1980 and 2011 adjustments is that they corresponded to local highs in the silver markets, which would take years to reattain. Adding yet more fuel to the fire, China is expected to impose export controls on silver starting on the first of January 2026. With that said, buyers are still putting pressure on precious metals as of this morning. How the situation resolves is anyone’s guess. The week ahead The economic calendar is once again devoid of content this week, with the notable exception of the latest FOMC minutes on Tuesday. The transcript should provide some insight into the Fed’s overall sentiment going into next year, but ultimately, few are expecting a rate cut at the end of January. On Wednesday, many markets will close early on New Year’s Eve, although US markets will remain open all day. Markets throughout the world will be closed on New Year’s Day, while Japanese markets will remain shut on Friday as well. In all likelihood, precious metals will dominate the week’s proceedings. #Silver #Platinum #Metals

  ●  Platinum surpasses $2,300   ●  Gold hits $4,500   ●  US growth figures exceed expectations Precious metals push higher It may have taken seventeen years, but platinum has finally beaten its long-standing record high established back in 2008, pushing beyond $2,300 per ounce as of this morning. The precious metal has gained a staggering $700 over the last two weeks and is now up 160% since the start of the year, beating the rallies in gold and silver. Speaking of which, gold ventured over the $4,500 mark earlier today, exploring new territory and adding another significant milestone to this year’s accomplishments. Silver meanwhile blasted through $70 per ounce yesterday, closing the day over $71 per ounce and pushing even higher this morning. Precious metals have exceeded all expectations this year, and continue to surprise even the most fervent of gold bugs. With one week to go before the end of the year, the question on everyone’s mind is how much higher metals can go in 2025. Surprise US growth figures The latest US GDP figures, published yesterday, revealed that the American economy grew by 4.3% in the third quarter – the fastest rate of growth in two years. The acceleration was largely driven by consumer spending, but also by a smaller trade deficit due to an increase in US exports. The data thoroughly outpaced economists’ predictions of 3.3% and came as a pleasant surprise to US stocks, pushing the S&P 500 to a fresh record high. The latest figures carried over to the crude oil markets, which are in the midst of a rebound following last week’s lows. The Brent benchmark crept back over $62 a barrel yesterday, while WTI managed to reclaim $58. #Platinum #Gold #SPX