Currency Pairs To Watch: Hot Picks for Forex Traders in 2024

Retail traders have more opportunities to succeed and win than ever. New and seasoned traders need to understand that being willing and able to change and adapt in a constantly evolving market will make or break traders. Today, we’ll go over currency pairs, and you’ll learn more about what to consider when picking pairs. The pairings generally offer “stable” returns and those that can provide the most incredible odds of massive returns but might be a bit more risky to invest in. More importantly, you’ll learn how to think like a long-term trader.

Forex Market 2024 Overview

2024 is also a critical year politically, and at least 25% of the world will elect new leaders this year, which traditionally affects the value of currencies. There’s been a sense of careful optimism in forex trading throughout the year. Seven months in, it still seems the industry is walking on eggshells while waiting for the outcome of prominent elections.

Wars in Europe and the Middle East continue to play a role, but most other things seem “flat” from 2023. Inflation is a significant issue that has been on everyone’s mind lately. For the forex market, 2024 can be considered “the year of uncontrollable inflation fueling the costs of living crisis.”

Importance of Choosing the Right Currency Pairs

The importance of choosing the right currency pair cannot be overstated. It’s the foundation on which successful trading careers and empires are built. There are “standard” trading pairs the majority of people indulge in. You can also chart your course by trading a major currency against little-known currencies. Nothing is stopping you from going all out and specializing in the trade of smaller pairs you understand well or have experience with. Whatever you do, ensure you use the right forex brokerage like OANDA to improve your odds of succeeding and outmaneuvering the market.

Major Currency Pairs To Watch

Every forex trader must pay attention to the moves of major currency pairs like USD-EUR, USD-GBP, and EUR-GBP. It doesn’t matter whether you’re trading these pairs or not; their activities have wide-reaching consequences.

It will also be in your best interest to keep an eye on what’s going on with currency pairs in the “east,” like USD-YEN, YEN-WON, and USD-RMB. The forex market is interwoven in such intricate ways that an attack on a small oil field in Southeast Asia can affect the value of currencies in South America.

Emerging Currency Pairs

There are more retail forex traders today than at any other time in history. Forex trading is more attractive and accessible to people from unexpected countries.

The growth of forex trading has also led to demand for more currency pairs. USD-EUR-GBP can only be traded so much. Many traders identify emerging currency pairs like RMB-WON, BRL-ZAR, CAD-MXP, and others as key growth drivers.

As a forex trader, you’re spoiled for choice in terms of potential currency pairs; that’s why you need to do your due diligence and use a reliable brokerage service like OANDA to improve your chances of success.

High Volatility Currency Pairs

Currency pairs can be volatile for several reasons. Volatility in currency pairs isn’t static, and a volatile pair today might become less volatile a week from now.

In early July 2024, many traders refrained from trading the GBP, fearing that “shocking” election results might lead to uncomfortable and sudden changes in its value. Now that the metaphorical dust has settled in the UK, the currency is less volatile than it was a few days ago. However, major currency pairs are often the most volatile in the market.

Factors Influencing Currency Pairs in 2024

Geopolitics, inflation, elections, wars, and other factors influence currency pairs in 2024. These factors affect currency pairs differently. For example, the ongoing war in the Middle East disproportionately affects the value of the Egyptian Pound.  

Trade deficits and growth projections also play a significant role in the value of currency pairs. You’ll learn more about the factors affecting the currency pairs you’re interested in trading during your research. Always keep in mind that nothing occurs in isolation in the forex market.

Strategies for Trading Hot Currency Pairs

One strategy you can use is studying macroeconomic data from different countries. For example, suppose you know that social welfare spending usually increases during the first quarter of the UK Labour Government, with these increases putting uneven strain on the GBP. In that case, you can make trading decisions based on your inferences. There are a plethora of different strategies you can employ when trading “hot” currency pairs. All you need to do is commit to being a student of the game by learning and refining your strategies as you grow.

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