EUR/GBP Live Charts

The EUR/GBP pair is a necessarily considered to be a major currency pair, but it should be noted that there is plenty of liquidity in this marketplace, as the two economies are each other’s number one trading partner. It is just a short hop across the English Channel in order to change currencies, so it makes a lot of sense that this pair would be important.

Live Chart of the EUR/GBP

Average Spread on the EUR/GBP

The pair has a relatively small spread, typically just three pips. However, one thing you have to keep in mind is that the pip value in this particular market is higher than most majors. In other words, while this pair does it move as far during a typical day, the value of the move will be comparable to other pairs. Because of this, a lot of traders will shy away from this pair whenever start trading. The truth of the matter is that it doesn’t trade any differently than other pairs the on the fact that a 30 pip move might be the entire day. However, when compared to other currency pairs such as the EUR/USD or the GBP/USD, that might be the equivalent of a 55 pip move.

There are a lot of moving parts when it comes to this particular currency pair. This is because a lot of the corporations that are set up in the United Kingdom will also do a lot of business in the European Union. Because of this, there is constantly money flowing back and forth in both directions, just as German companies may have major interests and the United Kingdom. Perhaps a French company is based in Calais, but has a significant presence in Manchester. These are the types of scenarios that move the currency pair.

Which Major News Announcements Impact the EUR/GBP?

There are a lot of economic announcements that can influence this pair. Obviously, interest-rate announcements come into play from both the Bank of England, and the European Central Bank. On top of that, you have GDP out of the United Kingdom, and the GDP out of both the European Union, and various European countries. However, we would be remiss if we did not state that by far the most important European country is Germany. They are 85% of the economic power that Europe represents.

It is because of that imbalance in the European Union that most of the important announcements from that side of English Channel come out of Germany, such as the ZEW announcement, employment numbers, CPI, and many others. In that sense, you have to think of this pair as “United Kingdom versus Germany”, as although there are other economies they can have a bit of an influence, it’s pretty rare that we see that. Typically, it is only under situations such as the Greek financial crisis that another country will come into play. At that point in time, it really becomes less about the currency pair in general and more about running from trouble.

As far as the best time to trade this pair, obviously the European session is by far the most liquid timeframe. This is because not only are Forex traders out and about trading, but corporations are doing business transactions for normal day-to-day operations. This adds the most liquidity to the marketplace, and therefore the most in the form of movement. However, this pair can do fairly well during the North American session at times as well. When it comes to Asian trading, this pair almost always goes to sleep in the end.

This is actually an excellent pair for short-term traders to begin to learn how to trade the markets. This is because you can dial down the leverage and trade a fairly calm currency pair. By simply cutting down the position size, you can make this a very manageable market to trade. However, you have to keep in mind that this market is a bit choppy as the two economies are so intertwined. Nonetheless, just like any other currency pair it does have a longer-term trend, which of course needs to be followed.

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