There are dozens of currency pairs on most platforms. You don’t need to trade them all, and you shouldn’t. Most successful traders focus on a handful they know well. The question is which ones.
Here’s a quick guide to the major pairs, the crosses that matter for Canadians, the pairs I personally avoid, and how to choose your own shortlist.
The seven majors
The major pairs all include the US dollar and are the most traded currencies in the world. That means tighter spreads and more liquidity.
| Pair | Nickname | What drives it | Personality |
|---|---|---|---|
| EUR/USD | Fiber | ECB vs Fed, eurozone and US data | The most traded pair; usually steady and liquid |
| USD/CAD | Loonie | Bank of Canada vs Fed, oil, trade with the US | Home pair for Canadians; very active around North American data |
| GBP/USD | Cable | Bank of England, UK data | Livelier than EUR/USD; bigger swings |
| USD/JPY | Gopher | Fed vs Bank of Japan, risk sentiment | Sensitive to interest rate gaps and occasional government intervention |
| USD/CHF | Swissie | Swiss National Bank, safe-haven flows | Often moves opposite EUR/USD |
| AUD/USD | Aussie | China, commodities, Reserve Bank of Australia | A risk-sensitive commodity currency |
| NZD/USD | Kiwi | Dairy and commodities, Reserve Bank of New Zealand | Similar to the Aussie, with thinner liquidity |
The pairs I focus on
I mostly trade EUR/USD and USD/CAD among the currency pairs, alongside gold. EUR/USD is liquid and tends to respect levels well. USD/CAD is the pair Canadians know best: its rhythm follows Canadian and US data and the Bank of Canada, which we cover in USD/CAD intraday.
When I want to avoid the US dollar, for example around a US election or a Fed decision, I switch to crosses. As we explained in our midterm elections guide, pairs like EUR/GBP, AUD/CAD, CAD/CHF and EUR/CAD let you keep trading without direct exposure to the dollar.
CAD crosses: worth knowing for Canadians
| Pair | What it reflects |
|---|---|
| EUR/CAD | The eurozone vs Canada, without the US dollar |
| AUD/CAD | Two commodity currencies against each other |
| CAD/CHF | A risk currency vs a safe haven |
| GBP/CAD | The UK vs Canada; livelier, with wider spreads |
Crosses usually have wider spreads than the majors. Check the costs before trading them; our guide to spreads, commissions and swaps explains what to compare.
Why I avoid yen pairs
I don’t trade the yen. Yen pairs have a whole different character, and I haven’t studied them enough to trade them with confidence. In my experience, price action on the yen doesn’t respect the things I rely on in the same way.
There are good reasons yen pairs behave differently:
- Interest rate gaps. Japan kept rates at or below zero for years while other central banks raised rates, so yen pairs became heavily driven by carry trades. When those trades unwind, moves can be violent, as in August 2024.
- Government intervention. Japan’s Ministry of Finance has stepped into the market to support the yen in the past, causing sudden, sharp moves.
- Safe-haven flows. The yen often strengthens when markets panic, which can override technical levels.
That doesn’t make yen pairs bad. It means they deserve their own study before you trade them. Knowing which markets you don’t understand is part of trading well.
Pairs beginners should skip
- Exotics, like USD/TRY or USD/ZAR: wide spreads, thin liquidity, and sudden gaps.
- Anything you haven’t studied. A pair you don’t understand can surprise you in ways the chart won’t warn you about.
- Too many pairs at once. Several dollar pairs can add up to one big bet; see our guide to currency correlation.
How to choose your shortlist
- Start with one or two majors, EUR/USD and USD/CAD are good choices for Canadians.
- Learn their personalities: active hours, how they react to news, how much they move in a day.
- Add a cross or two later, so you have options when you want to avoid the US dollar.
- Study any new pair before trading it, on demo first.
- Review your shortlist weekly, and focus on the instruments with the clearest setups.
The bottom line
The seven majors offer the tightest spreads and most liquidity, and EUR/USD and USD/CAD are natural starting points for Canadian traders. CAD crosses like EUR/CAD and AUD/CAD give you ways to trade without the US dollar. Yen pairs have their own character, shaped by carry trades, intervention and safe-haven flows, so study them before trading them. Skip exotics, keep your list short, and get to know each pair properly.
Disclosure: The author, Mike Harding, founded Academy of Financial Markets in Toronto and teaches its mentorship program. This article is educational and is not financial advice. Trading foreign exchange carries a high level of risk.