The EUR/USD pair can be described as the most frequently used investment instrument in the forex markets. Currency pairs, which represent the relative values of different currencies, are listed in the forex markets.
Forex traders evaluate these instruments through buy-sell transactions and establish return targets. The most popular of these pairs is the EUR/USD. This pair has a value that reflects the relative value of 1 Euro and 1 USD.
This most frequently traded pair is also the most popular pair in the forex market in terms of time density. Forex investors, having in-depth knowledge of this pair allows them to more easily grasp the EUR/USD fundamentals.
This pair is considered the pair most affected by global developments, as its value is highly relevant not only to financial developments but also to global relations.
The US central bank policies and the European Union's agreements directly affect the EUR/USD pair.
The EUR/USD pair is used by forex traders for both short- and long-term investment purposes. BlueSuisse offers free tools to manage portfolios more securely against sudden fluctuations.
Key Features of the EUR/USD Currency Pair
We can say that the most key features of the EUR/USD currency pair include:
- High liquidity
- Low spread
- High trading volume
- Low volatility risk
- Suitable for risk management
- Correlates with macroeconomic data
- Affected by global developments easily
Can be analyzed in conjunction with fundamental and technical analysis tools.
High liquidity allows for the rapid buying and selling of a forex pair. This is considered a key feature for investors. Low spreads minimize losses.
Correlating with economic news and global developments increases the success and profitability of fundamental analysis strategies.
Thanks to the EUR/USD features, thousands of investors from around the world use this pair in their strategies using digital forex tools. This pair, composed of two currencies valid in almost every country, is one of the best choices for risk management.
EUR/USD Trading Volume in the Forex Market
Forex investors need not worry about EUR/USD trading volume in the forex market. This pair boasts the highest trading volume in the forex market.
This ensures high liquidity and ease of trading. The EUR/USD volume expectation offers opportunities for all types of investors.
Its high liquidity and volume make it a good choice for both short-term and long-term investors seeking to profit from sudden price fluctuations through trading strategies. This feature makes professional investors more interested in "Understanding EUR/USD in the forex market."
If you'd like to explore forex trading strategies that comply with global security protocols, you can start the process now at BlueSuisse.
Why is EUR/USD Trading Volume So High?
So why is the EUR/USD pair trading so large?
The most obvious reasons for high EUR/USD trading volume in today's markets can be listed as follows:
- Influenced by US-European Union relations
- Two of the most popular world reserve currencies
- The most preferred exchange rates in global trade
- Highly correlated with economic indicators
- Directly affected by global developments
Due to these factors, this pair has the highest trading volume in the forex markets. Forex traders who want to take successful steps in risk management should prioritize this pair in their portfolios.
This pair, composed of the USD, the official currency of the USA, and the EURO, used within the European Union, comprises the currencies used in 90% of global trade.
Due to this structure, it is directly affected by news such as global developments, political disagreements, and trade agreements.
If economic management and political policies in the European Union send negative signals, the value of this pair increases. However, if the negative signals originate from the USA, the value of this pair will increase.
Is EUR/USD Better for Beginners or Professional Traders?
Within the "EUR/USD forex market," this pair is known to be suitable for both beginner investors and professional traders. Its low spreads and high liquidity align with the long-term expectations of professional investors.
Meanwhile, its predictable price movement creates an opportunity for beginner forex traders.
Because it's a pair directly affected by the financial policies of the United States and the European Union, beginner forex traders can more easily predict future market trends and build profitable portfolios.
In other words, common "EUR/USD forex pair trading strategies" are applicable for both newcomers to the forex markets and professional investors.
If you're a beginner forex trader, the EUR/USD forex pair will be suitable as an easily predictable investment instrument.
However, if you're a professional investor, you should include it in your portfolio due to its high liquidity. BlueSuisse also provides consulting and training on portfolio and risk management to investors through its forex platform. Open your live trading account in just a few steps now!
Key Economic News That Impacts the EUR/USD Currency Pair
The EUR/USD pair is directly affected by global developments and economic news. This is because this pair consists of the USD, the currency of a globally powerful country, and the EURO, the official currency used by European Union countries.
The fact that these two popular currencies form this pair is the main reason why it is directly affected by global developments.
News that affects the value of this pair can be listed as follows:
- Central bank interest rate decisions
- US employment data
- Inflation figures
- European Union GDP announcements.
Investors with advanced financial literacy and a strong understanding of forex markets can accurately predict future trends in the EUR/USD pair thanks to this key news.
Rising inflation rates in the US will lower the value of this pair, while negative developments in the European Union will increase its value. Investors managing EUR/USD trades should also monitor this political ecosystem.
Traders who want to be successful in the forex markets should follow not only financial developments but also international political developments.
Furthermore, as their experience and knowledge in forex markets increase, they will be able to more accurately predict the impact of non-financial developments on the EUR/USD pair.
This way, they can use fundamental analysis tools to build high-return portfolios.
While this can be a bit more challenging for beginner forex traders, many beginner investors are also among EUR/USD traders.