The currency pairs are traded on the market for forex. There are three major types of currency pairs:

Major pairs: Major currency pairs are the most commonly traded pairs in the forex market. They include USD, EUR JPY GBP CHF CAD USD. Major pairs are highly liquid and are characterised by minimal spreads, making them popular among traders.

-Minor pairs: Minor currency pairs, often referred to as cross-currency pairings don’t include USD in their pairing. These pairs are usually traded against USD or other major currencies. Examples of minor pairs include EUR/GBP, AUD/CAD, and CHF/JPY. Minor pairs can be less liquid or have wider spreads when compared to major pairs.

Exotic pairs: Exotic currency pairs are a major currency paired with an emerging or small economy. They are usually less liquid and have wider spreads than minor and major pairs. Some examples of exotic pairs are USD/MXN (U.S. dollar/Mexican peso), USD/TRY (U.S. dollar/Turkish Lira) and USD/ZAR (U.S. dollar/South African rand).

Here are a few major currencies that every Forex trader needs to know:

-U.S. Dollar (USD) USD: The U.S. dollar is the largest currency traded in the world and is involved in most Forex transactions. The USD is the main reserve currency around the globe and is widely used in international commerce and commodities. The USD is considered to be an unaffected currency. It can be affected by various factors such as U.S. interest rates, political issues, and economic information.

Euro (EUR): 19 countries of the European Union use the euro as their second-most traded currency. The euro is influenced by events in the economy, political developments, and the financial policies of the European Central Bank.

Japanese Yuen (JPY). The Japanese Yuen, which is the third most traded currency worldwide is used to fund carry trades. The Bank of Japan’s decisions on policy are influenced by economic information.

British Pound: The British Pound is the currency of United Kingdom. It is dependent on economic data, Bank of England policies and Brexit related events.

-Swiss Franc (CHF): The Swiss currency is considered to be an investment in safety and is often utilized by traders to hedge against risk. Swiss National Bank policy decisions, global risk sentiment, and economic data influence the value of this currency.

Canadian Dollar (CAD). The Canadian Dollar is often referred as a commodity-currency due to Canada’s large exports of natural resources. The Canadian dollar is affected by a myriad of factors which include the price of oil, economic statistics, and Bank of Canada policies.

-Australian Dollar (AUD): The Australian dollar is yet another commodity currency that is heavily influenced commodity prices, economic data, as well as Reserve Bank of Australia policy decision-making.

-New Zealand Dollar (NZD): The New Zealand dollar is also one of the commodity currencies that are influenced by many factors, such as economic data, commodity prices, and Reserve Bank of New Zealand policy decision.

The article’s conclusion is:

Currency pairs are traded on the Forex market. There are three types of currencies:

-Major pairs Major currency pairs are the most commonly traded pairs in the forex market. These are USD, EUR JPY GBP CHF CAD USD. Major pairs are very liquid and are characterized by minimal spreads, making them popular with traders.

Minor pairs Minor currency pairs often referred to as cross-currency pairings are not paired with the USD in their pairing. They are frequently traded against USD or any other major currency. Minor pairs are EUR/GBP as well as the AUD/CAD. Minor pairs can be less liquid or come with wider spreads when compared to major pairs.

Exotic pairs: These pair are made up of a major currency and a minor currency. These are usually more liquid, and are more spread-based than the major and minor pairs. Some examples of exotic pairs are USD/MXN (U.S. dollar/Mexican peso) USD/TRY (U.S. dollar/Turkish Lira) as well as USD/ZAR (U.S. dollar/South African rand).

Here are a few major currencies that each Forex trader needs to know:

-U.S. dollars (USD): the U.S. dollar, which is utilized in numerous Forex transactions is the most frequently traded currency in the world. It is the world’s primary reserve currency, and is utilized in numerous commodities as well as international transactions. The USD is often considered an unassailable currency and could be influenced by a variety of factors, like U.S. economic data, interest rates, and geopolitical events.

Euro (EUR): 19 countries of the European Union use the euro as their second most traded currency. The euro is affected by events in the economy, political developments, as well as the economic policies of the European Central Bank.

Japanese JPY (JPY) (JPY): The Japanese yen is third most traded currency around the globe and is used primarily as a currency to fund carry trades. Economic data could influence Bank of Japan policy decisions and the global risk perception.

The British Pound is the currency of the United Kingdom. It is heavily influenced by economic information, Bank of England policies and Brexit related events.

-Swiss the franc (CHF). The Swiss franc, which is a safe-haven money, is employed by traders as a protection against risk. This currency is influenced by the Swiss National Bank’s policies, global risk sentiment and economic information.

Canadian Dollar (CAD). The Canadian Dollar is often referred as a commodity-currency due to the country’s vast exports of natural resource. The Canadian dollar is affected by a number of factors which include the price of oil economic statistics, as well as Bank of Canada policies.

-Australian Dollar: The Australian Dollar is a different currency that is heavily influenced and affected by the Reserve Bank of Australia’s policies and economic data as well as the prices of commodities​_

New Zealand Dollar (NZD): The New Zealand dollar is also a commodity currency, which is influenced by factors, such as economic statistics, commodity prices and Reserve Bank of New Zealand policy decisions.

The final sentence of the article is:

It is important for traders to know the characteristics of each type of currency pair as different pairs can have different trading behaviors and the risks that come with the risk they carry. Understanding the various types of currency pairs can help traders make an informed choice about which pairs to use and how to manage the risk.