How to Trade Euro (EUR)?

Euro is the common currency of the European Union used in 20 of 27 countries of the Eurozone. In this article, Headway experts share what to pay attention to when you want to trade EUR. Learn more about the Euro and trade it on Headway!

What influences the EUR price? 

Euro is also the second most traded currency in the world. Its price is therefore influenced by many factors, global and local. To trade it on Forex, take into consideration the following factors to affect EUR:

Economic factors. It’s important to keep up-to-date with the latest economic indicators and events that impact the Eurozone. This includes factors like GDP growth, inflation rates, employment data, and any political developments. You can monitor this data in the Headway economic calendar.

Monetary policy. European Central Bank’s monetary policy decisions and statements can greatly affect the value of the Euro. Any alteration in interest rates or a change in the ECB’s approach to quantitative easing can impact currency movements.

Eurozone stability. Keeping an eye on the political and economic stability of the Eurozone is crucial. Elections, referendums, or financial crises in member countries can affect the performance of the Euro.

Global market sentiment. Market sentiment and risk appetite can have an impact on currency flows. There are various factors to consider such as geopolitical tensions, trade disputes, and economic developments in major economies. These factors can all affect the value of the Euro.

Correlations. The EUR often shows strong correlations with other major currencies. Specifically, currency pairs such as EURUSD, EURGBP, and EURJPY tend to have higher liquidity and trading volume.

In what pairs does EUR perform best?

The Euro (EUR) is one of the most widely traded currencies in the world. It performs best in pairs with other major currencies. Here are some currency pairs in which the Euro typically exhibits significant trading volume and liquidity:

EURUSD (Euro/US Dollar). This is the most actively traded currency pair globally. It is influenced by the economic indicators, monetary policies, and market sentiment of both the Eurozone and the United States.

EURGBP (Euro/British Pound). It is influenced by economic data, monetary policies, and political developments in the Eurozone and the United Kingdom.

EURJPY (Euro/Japanese Yen). It is influenced by economic indicators, monetary policies, and market sentiment in both the Eurozone and Japan. The EURJPY pair is known for its volatility and is often influenced by risk appetite in the financial markets.

EURAUD (Euro/Australian Dollar). It is influenced by economic data, commodity prices, and market sentiment in both the Eurozone and Australia.

EURCHF (Euro/Swiss Franc). It is influenced by economic data, monetary policies, and safe-haven flows. The EURCHF pair is often affected by the interventions and policies of the Swiss National Bank. 

These are just a few examples of the currency pairs in which the Euro performs well. However, it’s important to note that market conditions and dynamics can change over time.

Follow us on social media (Telegram, Instagram, Facebook) to get the Headway updates instantly.