Major forex pairs
Family I · Instruments
Not to be confused with forex pairs, exotic currency pairs, minor currency pairs.
Major forex pairs are the currency pairs that account for the largest share of daily turnover on the global foreign exchange market. Each major pair consists of the US dollar on one side and one of a small group of other highly liquid currencies on the other. They are distinguished from other pairs by tight bid-ask spreads and deep order books rather than by any official designation.
Composition and turnover
The group conventionally comprises seven pairs: EUR/USD, USD/JPY, GBP/USD, USD/CHF, USD/CAD, AUD/USD and NZD/USD. The exact list can vary slightly between brokers and data providers, and some sources also include USD/CNY or USD/MXN as turnover in those pairs has grown.
Because they are quoted continuously and in large size, major pairs typically show narrower spreads than other categories. The currencies involved are issued by large, open economies with deep financial markets, which supports continuous two-way pricing.
Worked example: spread cost on a major pair
Assume EUR/USD is quoted with a bid of 1.0850 and an ask of 1.0851, a spread of 0.0001 or 1 pip. A trader buys 1 standard lot (100,000 euros) at the ask and later sells at the bid.
The same calculation on a less liquid pair with a 5-pip spread would produce a cost of 50 USD, illustrating why major pairs are often preferred for high-frequency or short-term strategies.
Trading sessions and liquidity
Liquidity in major pairs is not constant. Activity concentrates when the financial centres of the two currencies overlap, such as the London–New York overlap for EUR/USD or the Tokyo–London overlap for USD/JPY. Outside those windows, spreads can widen and slippage may increase, though major pairs generally remain more liquid than other categories at all hours.
Often confused with
- forex pairs
- Forex pairs is the broad category of all traded currency pairs, while major forex pairs is a subset defined by the inclusion of the US dollar and high liquidity; the visible sign is that a major pair always has USD on one side.
- exotic currency pairs
- Exotic currency pairs combine a major currency with the currency of a smaller or emerging economy, whereas major forex pairs consist only of currencies from large developed economies; the visible sign is that an exotic pair includes a currency such as TRY, ZAR or MXN.
- minor currency pairs
- Minor currency pairs, also called crosses, exclude the US dollar entirely, while major forex pairs always include it; the visible sign is that a minor pair such as EUR/GBP has no USD in its symbol.