most volatile currency pairs: Most volatile pairs How to trade volatile currency pairs in FX

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New Zealand’s tourism industry is a major economic driver, therefore when the industry is doing well, the currency tends to strengthen. Remember that the volatility of a currency pair can change over time as the relevant factors change. But overall, the pairs below are considered some of the most and least volatile.

volatile pairs

The currencies are Hong Kong, New Zealand, Singapore dollar, Norwegian Krone, and Swiss franc. The most volatile currency pair in 2022 was USD/RUB because of the Russian economy during the war situation. EU payments for Russian pipeline gas greatly impact the rising currency. Additionally, the most volatile currency pairs in 2022 are USD/BRL, USD/ZAR, and USD/SEK . The least volatile currency pairs are USD/HKD, USD/CNY, and USD/INR. Volatility in finances means the frequency and strength of price change.

Since volatility is a crucial parameter that needs to be measured to understand market conditions, several ways of measuring volatility are listed below. Now that we have covered the most volatile pairs, let’s look at the least volatile currency pairs. Generally speaking, the major currency pairs are seen as the least volatile because they have historically been the most traded currencies amongst traders. The most volatile forex pairs can give your more profits or bigger losses. Here in this article, you will learn more about volatility, how it comes about, and some of the most volatile currency pairs available. In the Forex market, some currency pairs are more volatile than others, which gives traders a choice between trading more stable pairs with less price movement, or volatile ones that can maximize profits.

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High-liquid assets, such as major forex pairs, have low volatility and move in smaller increments. The most volatile currency pairs can sometimes be hard to determine since volatility can impact different currencies at all different times. When choosing currency pairs, you need to think about a few factors, like volatility. Not all currency pairs have the same volatility, some are considered the most volatile currency pairs than others, and there is a reason for that. Trading volatile currencies mean that prices can fluctuate heavily in a short period of time, and the market trend can change its direction a few times in one day. Therefore, the stop-loss option in Forex helps traders to avoid excessive losses.

The formula of the most volatile currency pairs daily range used here is mentioned in the methodology section. The average daily range of US30 in 2022 is 549 and its 310 for nas100. Some use ADR to calculate average daily range which is the difference between the high and low of a series of candles or bars. Use search to find a currency pair, or a specific category for example USD for USD/JPY, EUR/USD, AUD/USD, etc. For example, an increased inflation rate might motivate the national bank to print more currency and pump it into the economy, which leads to a fall in the value of the currency. The UK economy is growing at a faster rate than the Australian economy.

  • The Canadian Dollar is also known for being susceptible to oil prices due to Canada’s energy exports.
  • If you’re interested in trading CAD/JPY, it’s crucial to monitor the oil markets and preempt any factors which could cause sudden price fluctuations.
  • Therefore, when the export market prices change, they affect NZD’s value against that of the JPY.

Traders spend fewer hours in the market, which also reduces liquidity. Along with decreased hours registered by the traders, the moves also become smaller. Even though the other half of the NY session is not as lively and volatile as the first half, there are still ways to profit.

Best forex pairs to trade

As for the cross rates, GBP/NZD, GBP/AUD, GBP/CAD, and GBP/JPY are the most fluctuating currency pairs. On the opposite side, we have the minimum of the average daily range. It shows the least pips that the price of each currency pair can reach. Another factor that determines volatility in the Forex market is global news and events. Trading wars, regional disputes, inflation, and interest rates can all lead to changes in the economy, which influences the value of the local currency. Usually, major currencies are less volatile than crosses or exotic pairs.

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This is not the same for the AUD, and because of this, the AUD/JPY pair can experience dramatic price movements depending on global economic changes. Let’s say I want to calculate the average daily range for one year which is something between 260 to 263 candles. There are gaps between this range of candles that are part of the movement of that currency pair so you shouldn’t eliminate or ignore them. They are like invisible candles that do affect the market and make higher timeframes’ candles or bars along with the visible ones.

Japanese Yen (JPY)

Major currencies are more stable because they are connected to relatively stable economies, which do not intake sudden monetary changes. Also, major news about economic changes or government policies will affect the sentiments of investors. For instance, when the COVID pandemic started, this triggered an increase in the market’s volatility. Largely speaking, volatile pairs are affected by the same drivers as their less-volatile counterparts. These include interest rate differentials, geopolitics, the perceived economic strength of each currency’s issuing country, and the value of these nations’ imports and exports.


Also, the most volatile currency pairs are highlighted in the list below. Volatility in forex trading is a measure of the frequency and extent of changes in a currency’s value. A currency might be described as having high volatility or low volatility depending on how far its value deviates from the average – volatility is a measure of standard deviation. More volatility means more trading risk, but also more opportunity for traders as the price moves are larger. offers regulated forex trading through tokenised currency pairs.Learn how to trade on the platform.

What is your sentiment on EUR/GBP?

Each step involves a process and beginner traders will need to conduct the necessary research into each to ensure that they are prepared for trading in a live environment where their funds are at risk. Although these steps may sound simple, each one entails a series of steps and processes which need to be followed. Beginner traders cannot start trading without ensuring that they have the necessary Forex knowledge and general know-how of trading. Traders can then proceed to select a trading strategy that they are comfortable with, familiarize themselves with the strategy, backtest it, and ensure that they are comfortable with their exposure to risk.

  • On the other hand, the Japanese yen is considered the safe-haven currency as investors turn to it in times of hardship.
  • It shows how volatility in that pair varied over the time frame analyzed, as well as by hour and trading day.
  • This diversion between the two countries’ economies is what leads to this volatility in the Forex market, where the prices of the quote currency and the base currency perform differently.

No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.

The most volatile currency pairs tend to move in opposite directions at the same time. This means that when one currency rises against another, the other will fall. One of them turns out to be “volatility,” a term that is thrown around a lot.


The Most Volatile Currency Pairs TableThe table shows that today the most volatile Forex pairs are exotic, namely, USD/SEK, USD/TRY, and USD/BRL. The hourly volatility diagram for NZD/USD, which peaks at 12 and 21 o’clock , is of particular interest. It entirely coincides with the time of economic data releases for the USA and New Zealand. It also confirms the thesis on volatility increase upon major financial data releases mentioned at the beginning. There are times when the currency price stands still or moves within a very narrow range.

The Russian ruble, Brazilian real, Mexican, and Argentine peso are these currencies. Exotics are currency pairs that include one or two currencies of emerging markets, e.g., USD/MXN, USD/ZAR, USD/TRY, etc. They are characterized by low trading volume and are extremely risky to trade due to their high volatility.

We advise you to carefully consider whether is appropriate for you based on your personal circumstances. We recommend that you seek independent advice and ensure you fully understand the risks involved before trading. Using a trading journal to keep a log of your trades is a very good habit to adopt.

Because of this inflated exchange rate, price movements in the USD/KRW pair are common, and many traders look to this pair as a way to make a quick profit. The first volatile currency pair on our list is AUD/JPY, which represents a pairing of the Australian dollar against the Japanese yen. This pair enjoys high volatility thanks to the inverse relationship between the Australian dollar and Japanese yen. There are several pairs that you can successfully trade during the NY session. Given that the NY and London sessions overlap for four hours, most major currency pairs have USD, EUR, and GBP. As soon as the London session is over, the volatility decreases drastically.

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When trading these less volatile currency pairs, traders should consider trading spreads or entry orders to ensure a greater chance of a favourable entry. Forex traders must be careful of deviations in any currency pairs they are trading and all other currency pairs and correlations for effective risk management. Positive or negative correlations of currency pairs give the traders an overview and a clear picture of the direction they should be trading and avoiding. In the forex trader’s best interest, focus on a currency pair with great potential and avoid choosing highly volatile ones.

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