Lesson 1 of 12 · 9 min
Why pairs behave differently
Every pair has its own hours, drivers, range and costs. Learn the four differences that matter, and the major, cross and exotic families, before meeting the pairs one by one.
By the end you'll be able to
- Name the four ways pairs differ that matter to a trader, from when they move to what they cost
- Sort any pair into major, cross or exotic and say what that tells you about cost
- Explain why the same lot size swings by different amounts of money on different pairs
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EUR/USD and GBP/JPY sit next to each other on your platform, with the same buy and sell buttons. Trade them the same way, though, and you will soon find that they wake at different hours, react to different news and travel very different distances in a day.
Three families of pairs
A currency pair prices one currency in another. Traders sort the pairs into three families:
- Major pairs combine the US dollar with one of seven other big currencies: the euro, yen, pound, Swiss franc and the Australian, Canadian and New Zealand dollars. EUR/USD and USD/JPY are majors.
- Cross pairs, also called minors, combine two of those big currencies without the dollar, such as EUR/GBP or GBP/JPY.
- Exotic pairs match a big currency with one from a smaller or emerging economy, such as USD/ZAR.
The labels matter because liquidity, how much buying and selling is going on, usually falls from majors to crosses to exotics. Costs rise as it falls. The exotics lesson shows how far.
Within each family, pairs still differ in four ways.
1. When they move
Typical activity by hour (illustrative)
Northern summer hours (UK on BST). In the UK winter the Asian sessions start about an hour earlier in UK time.
Typical activity by hour in UK time for nine pairs. Slide the hour or tap a pair. An illustrative model of typical activity, not live data; news can make any hour busy.
Each currency has a home session, the hours when its banks are at work and its data comes out. Its pairs are busiest then. At 03:00 UK time USD/JPY is already moderately busy in Tokyo hours, while EUR/USD and EUR/GBP are close to asleep. Slide to 14:00 and almost every row darkens: London and New York are both open.
2. What moves them
Every pair is two economies and two central banks, so each one answers to different news. EUR/USD follows the gap between ECB and Fed interest rates. The Australian, Canadian and New Zealand dollars are commodity currencies: metals, oil and dairy matter to them. The yen and the Swiss franc are safe havens, often bought when fear rises, so their pairs also answer to risk mood, the market swinging between confidence and fear.
3. How far they move
Volatility is how far and how fast a pair typically travels. On an ordinary day EUR/USD often covers 50–90 pips; GBP/JPY often covers 100–200. A busier pair needs a wider stop, so a smaller position for the same money at risk.
4. What they cost
You pay the spread on every trade. On EUR/USD it is often under a pip in busy hours. Crosses are usually a little wider, and exotics much wider. The same pair also costs more in its quiet hours, when fewer banks are quoting.
GBP/JPY moved about twice as many pips, but each pip was worth two-thirds as much, so the money swing was about 1.4 times larger. You need both numbers, the range and the pip value, to know what a lot size means. The sizing lesson shows how to set size from them. These ranges are illustrative, and on a news day either pair can move much further.
The rest of this course takes the main pairs one at a time, then brings them back together to size, combine and choose them.
Try it
EUR/USDFiber
The deepest, cheapest market in forex: it can drift for days, then move hard on US data or a central-bank surprise.
LiquidityDeepest
The most traded pair in the world
Typical volatilityModerate
Ordinary days often 50–90 pips
Typical spread (shorter bar = cheaper)Tightest
Often under 1 pip in busy hours
Sensitivity to risk moodMild
Tends to dip in risk-off as the dollar is bought
When it moves (UK time)
Most active in the London session (about 07:00–13:00) and the London–New York overlap (about 13:00–17:00), usually the busiest stretch. Illustrative UK times; Asian-session hours shift by about an hour with daylight saving.
Main drivers
USD/JPY
A yield-gap pair that trades in Tokyo hours as well as New York, with sudden lurches when fear or Japan’s authorities step in.
LiquidityVery deep
Usually the second most traded pair
Typical volatilityAbove average
Usually more pips a day than EUR/USD (a yen pip is 0.01)
Typical spread (shorter bar = cheaper)Tight
Usually tight in active hours
Sensitivity to risk moodHigh
Tends to fall in risk-off as the yen is bought
When it moves (UK time)
Most active in Tokyo hours (about 00:00–09:00) and the London–New York overlap (about 13:00–17:00). Illustrative UK times; Asian-session hours shift by about an hour with daylight saving.
Main drivers
GBP/USDCable
EUR/USD’s livelier cousin: wider daily swings, sharp moves on 07:00 UK data and a long memory for political shocks.
LiquidityVery deep
Very deep, though thinner than EUR/USD
Typical volatilityAbove average
Often 70–120 pips; 100+ is not unusual on a busy day
Typical spread (shorter bar = cheaper)Tight
Often around 1–1.5 pips in busy hours
Sensitivity to risk moodModerate
Sterling is not a safe haven, so it tends to fall in risk-off
When it moves (UK time)
Most active in 07:00 UK data, the London open from about 08:00 and the London–New York overlap (about 13:00–17:00). Illustrative UK times; Asian-session hours shift by about an hour with daylight saving.
Main drivers
AUD/USDAussie
A liquid way to read China, commodities and global growth: it tends to rise with confidence and fall fast with fear.
LiquidityDeep
A liquid major, heavily traded for its size
Typical volatilityAbove average
Often 40–80 pips
Typical spread (shorter bar = cheaper)Tight
Usually tight; often a touch wider than EUR/USD
Sensitivity to risk moodVery high
Tends to rise on calm days and fall fast in a panic
When it moves (UK time)
Most active in Asia-Pacific hours (about 22:00–07:00), the London open and the London–New York overlap (about 13:00–17:00). Illustrative UK times; Asian-session hours shift by about an hour with daylight saving.
Main drivers
EUR/GBP
Two neighbouring economies whose currencies tend to drift together: small daily ranges, so the spread matters more.
LiquidityDeep
Deep in London hours, thin outside them
Typical volatilityQuiet
Often 30–50 pips
Typical spread (shorter bar = cheaper)Moderate
A little wider than EUR/USD, and large next to its range
Sensitivity to risk moodLow
Little direct link: both sides tend to react alike
When it moves (UK time)
Most active in the London session (about 07:00–16:30), busiest in the morning; quiet outside it. Illustrative UK times; Asian-session hours shift by about an hour with daylight saving.
Main drivers
GBP/JPY
The widest-ranging pair here: pound news and yen safe-haven swings combined, so stops need room and positions must be smaller.
LiquidityGood
Good in London hours; thin in late US hours
Typical volatilityVery high
Often 100–200 pips
Typical spread (shorter bar = cheaper)Wider
Wider than GBP/USD or USD/JPY, small next to its range
Sensitivity to risk moodHigh
Falls sharply when fear returns and carry trades unwind
When it moves (UK time)
Most active in stirs in Tokyo hours, then fully alive from the London open (about 07:00) through the overlap to about 17:00. Illustrative UK times; Asian-session hours shift by about an hour with daylight saving.
Main drivers
Switch between six pairs and compare their gauges, pip value, busy hours and drivers. Typical behaviour, not a forecast; figures are illustrative.
Notice how EUR/USD and EUR/GBP share the euro, yet EUR/USD scores “Deepest” for liquidity and “Tightest” for spread, while EUR/GBP is the quietest of the six and its spread is large next to its range.
Quick check
Quick check
Question 1 of 4
Which of these is a cross pair?
Question 2 of 4
It is 03:00 UK time. Which pair is usually more active?
Question 3 of 4
At 0.10 lots, EUR/USD moves 70 pips in a day and GBP/JPY moves 150 pips, with USD/JPY at 150. What is the money swing on GBP/JPY?
Question 4 of 4
Why do exotic pairs usually cost more to trade than majors?
Go deeper: The most traded currency pairs (and why liquidity matters) · Major, minor and exotic currency pairs · Best currency pairs for beginners