Forex works on currency pairs. In short, it means that to buy a currency, you’ll need to use another currency. For instance, if you want euros, you can spend dollars. In this case, the pair will look like ‘USD/EUR.’ But you can replace any of these two with another currency available on the market.
It’s a hugely flexible market, which is one of its many attractions. You can also swap any type of money for any other type of money at any given moment. The only thing that can stop you, in this case, is if the Forex broker you’ve chosen simply doesn’t support a currency you want. You can see how some popular pairs currently behave here.
Current Overall Situation
The Forex economy isn’t doing too hot at the moment, much like a lot of other markets. Because of several recent problems, such as the agricultural crisis, the energy crisis, and the ensuing oil crisis, many national economies were left shaken – especially those in Europe.
What also helped deteriorate the world economy is a punch the American economy recently received. Crypto fell, and several big companies in the US lost much of their value at the same time. This combination meant that dollar started to stagger, which further deepened the issues.
So, in this current climate, what are the safest and most profitable currency pairs to trade?
USD/EUR
This combo has always been a fan favorite, and it accounts for almost a quarter of all Forex trades. The reason you might want to stick to this pair is because of the speculation and profits you might get from swapping dollars for euros and back. Short-term profits and micro profits are currently the best options, and this pair is pretty good for it.
USD/CAD & USD/AUD
Canadian dollar and Australian dollar are currently getting cheaper in comparison to their American counterpart. This means that you can buy these and await a reliable increase in price for the coming months. They were previously popular because of their constant but contained fluctuations, but now it’s all about growth.
If you want to invest in CAD or AUD, hoping that, when the crisis abates, their value will be restored, then you are one of the many people to invest in these two in 2022.
USD/CHF
This one is curious. Before, a lot of people chose to spend their dollars to buy pounds whenever the situation called for a diversified portfolio. They were both stable and valuable goods, but if one were to fall, you would have another that is very likely still healthy and stable.
This obviously changed when the British economy started acting up. Now, one of the better alternatives to the pound is the Swiss franc. It’s relatively obscure for American users, but it has essentially been retaining its value in relation to USD for the past 15 years. Because of it, it’s one of the best ways to diversify your Forex portfolio.
