Monday, August 4, 2008

Currency Trading Basics - the Best Currencies to Trade

Author: kelly Price


What are the best currencies to trade? Here we will answer this
question and also look at a few over looked currencies and in
particular one of the best for novice traders.

Here we are going to look at the best currencies against the US
Dollar.

Perhaps the most important consideration is turnover and
liquidity of the currency traded. and these currencies also
offer the tightest pip spreads which reduce your cost of doing
business. You can trade the majors for just 2 or 3 pips and the
currencies with the highest volume against the dollar are.

- The Euro

- The Japanese Yen

- The British Pound

- The Swiss Franc

Any trader should consider the above 4 and the euro and the yen
are favorites for most traders and will work well for swing
traders or trend followers.

I trade the euro, yen and Pound but not the Swiss Franc -
nothing against it, it's a great trending currency but it tracks
the euro to a degree now as the country has become more
integrated with Europe so I have picked the euro.

Two other great currencies to trade are, the Australian and
Canadian Dollar.

They don't have the volume of the big 4 and spreads are a little
wider but for trend followers they offer some excellent trends
and with both being commodity currencies, they have given some
great trends over the last few years with the recent surge in
commodity prices.

If I was to pick a currency that is good for novices, it
wouldn't be the euro or the yen - but the Canadian dollar.

It works well on any technical system and offers reliable trends
and the major advantage is it lacks the frequent volatility
spikes you see in the big two

Of course any list of best currencies to trade is going to be
subjective but if you are a novice trader or trading the majors
and want a change, check out the Canadian dollar - it really is
a great currency to trade.

About the author:
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