Majors versus crosses
Majors include the US dollar on one side and carry the tightest spreads and deepest liquidity. Crosses exclude the dollar and are effectively two dollar trades combined, which is why their spreads are wider and their moves can be less orderly.
For a new trader, EURUSD, GBPUSD and USDJPY offer the cleanest combination of low cost and predictable behaviour.
Session structure
Tokyo hours favour yen and Australasian pairs. London brings the largest volume increase of the day. The London–New York overlap is the highest-liquidity window, and typically where tight spreads and sustained trends coincide.
- Asian session: ranges, lower volatility, wider spreads on European crosses
- London open: expansion, frequent false breaks in the first 30 minutes
- Overlap: tightest spreads, most reliable follow-through
- Late New York: fading liquidity, avoid new positions before rollover
Costs specific to FX
Spread is small in absolute terms but significant relative to typical intraday ranges. Swap becomes the dominant cost on multi-day positions, especially on pairs with a large interest differential.
What moves currency pairs
Interest rate expectations dominate. Inflation prints, employment data and central bank communication reprice those expectations, which is why calendar awareness matters more in FX than technical setups alone.