EUR/USD: what it is like and when it works best

EUR/USD is the most traded pair in the world. For a beginner it is almost always the right place to
start, and not only because of the liquidity.

1. Why it suits learning

• The tightest spread of any instrument on the list — the cheapest place to
  learn.
• A moderate range, usually 60–100 pips a day. Enough for opportunities, not enough
  to turn one mistake into a disaster.
• Abundant material — every analysis and every textbook uses it as the example.
• Few erratic jumps, thanks to the depth of the book.

2. The best hours

• 08:00–12:00 UTC — the London session. The day’s trend usually forms here, and
  spreads are tightest.
• 12:30–17:00 UTC — the London/New York overlap, the highest volatility, and where
  most US data is released.
• The Asian session — typically listless, a narrow range and a wider spread. Not a
  good window for this pair.

For anyone with a day job in a European or Asian evening, 08:00–16:00 UTC is both the realistic
window and the best one for this instrument — a convenient coincidence.

3. What moves it

EUR/USD is a comparison between two economies and two central banks:

• The gap between Fed and ECB rate expectations — the dominant long-run factor.
• Inflation data on both sides.
• The growth differential, tracked through
  PMI in both regions.
• Global risk aversion — the dollar is a
  haven asset, so crises usually push this pair down.

4. The data calendar

• United States: CPI,
  NFP (the first Friday of the month), Fed
  decisions, retail sales.
• Euro area: CPI, ECB decisions, PMI, and German figures in particular — the
  bloc’s largest economy.

5. What it actually costs

• Standard account: a 0.8–1.4 pip spread → about $8–14 per lot.
• Raw account: a 0.0–0.3 pip spread plus $6 commission → about $6–9 per lot.
• Swap: depends on the US–euro rate differential and changes over time. Check the
  contract specification before holding for long.

That is the lowest cost you will find anywhere on the instrument list, and one more reason to
concentrate on this pair at the start.

6. Psychological levels

Round numbers such as 1.0500, 1.1000 and 1.1500 collect a great many resting orders and usually
produce a visible reaction. They are worth marking on the chart whatever method you use.

This article is for information only and is not investment advice. Conditions and fee levels are published by the brokers and can change at any time — check with the broker you actually use. Leveraged forex and CFD trading carries a high level of risk and can cost you your entire deposit.