For beginners in China, trading forex pairs that are liquid, less volatile, and widely traded is an excellent way to start. The most commonly traded forex pairs for beginners typically include major currency pairs and some regionally relevant ones like the Chinese yuan. These pairs are easier to understand, come with lower trading costs, and offer predictable price movements. Below is an overview of the most commonly traded forex pairs for beginners in China.

1. USD/CNY (US Dollar/Chinese Yuan)

• Why It’s Popular: The USD/CNY pair is highly relevant to China’s economy, as it reflects the exchange rate between the world’s largest economies. It’s particularly important for traders in China due to its ties to the People’s Bank of China (PBOC) policies and the managed exchange rate system.
• Key Features:
  • Moderate volatility influenced by trade data, economic policies, and global events.
  • A good starting point for beginners familiar with China’s domestic market.
• Best For: Traders wanting exposure to the yuan and those seeking to understand the dynamics of China’s forex market.

2. EUR/USD (Euro/US Dollar)

• Why It’s Popular: The EUR/USD is the most traded forex pair globally, offering high liquidity and narrow spreads, which makes it beginner-friendly.
• Key Features:
  • Widely covered in market analysis and news, making it easier to find educational resources and insights.
  • Predictable movements due to its strong correlation with economic indicators from the Eurozone and the US.
• Best For: Beginners looking for a stable and widely traded pair with abundant learning materials.

3. USD/JPY (US Dollar/Japanese Yen)

• Why It’s Popular: As the second most traded currency pair, USD/JPY offers high liquidity and steady trends, making it an excellent choice for beginners.
• Key Features:
  • Low trading costs due to tight spreads.
  • Regular volatility influenced by the Bank of Japan’s policies and global risk sentiment.
• Best For: Beginners interested in the Asian market with a focus on predictable trading conditions.

4. AUD/USD (Australian Dollar/US Dollar)

• Why It’s Popular: AUD/USD is highly correlated with commodities like iron ore and gold, making it ideal for beginners who want to understand how commodity prices influence forex markets.
• Key Features:
  • Steady trends tied to China’s demand for Australian exports.
  • Moderate volatility, offering opportunities for learning and profit.
• Best For: Beginners interested in commodity-linked currencies and regional trade dynamics.

5. GBP/USD (British Pound/US Dollar)

• Why It’s Popular: Known as “Cable,” GBP/USD is a major currency pair offering liquidity and steady trading opportunities.
• Key Features:
  • Moderate to high volatility driven by economic data from the UK and US.
  • Provides insights into how political events, such as Brexit, influence currency movements.
• Best For: Beginners who want to explore the impact of geopolitical and economic news on forex.

6. USD/CNH (US Dollar/Offshore Chinese Yuan)

• Why It’s Popular: The USD/CNH pair allows traders in China to engage in offshore trading of the yuan, providing exposure to global market forces.
• Key Features:
  • Reflects international demand for the yuan without domestic restrictions.
  • Moderate volatility influenced by trade relations, global events, and central bank policies.
• Best For: Beginners familiar with China’s economy but interested in trading the yuan in an offshore environment.

7. NZD/USD (New Zealand Dollar/US Dollar)

• Why It’s Popular: Similar to AUD/USD, the NZD/USD is a commodity-linked pair, providing insights into trade and agricultural export dynamics.
• Key Features:
  • Relatively stable trends influenced by commodity prices and global trade.
  • Good for learning about how smaller economies like New Zealand interact with global markets.
• Best For: Beginners looking for a less volatile yet dynamic forex pair.

8. EUR/JPY (Euro/Japanese Yen)

• Why It’s Popular: EUR/JPY is popular among traders seeking exposure to both European and Asian markets in a single pair.
• Key Features:
  • Combines the liquidity of EUR/USD and USD/JPY, making it suitable for beginners.
  • Moderate volatility influenced by risk sentiment and economic data.
• Best For: Beginners interested in trading cross pairs while gaining experience with regional market interactions.

Tips for Beginners When Choosing Forex Pairs

1. Start with Major Pairs: Major currency pairs like EUR/USD, USD/JPY, and GBP/USD offer high liquidity and lower trading costs, making them beginner-friendly.
2. Understand the Market Drivers: Choose pairs where you can easily access information about economic and geopolitical factors influencing the currencies.
3. Focus on Low Volatility: Avoid highly volatile or exotic pairs as a beginner, as they can lead to significant losses without proper experience.
4. Practise on a Demo Account: Use a demo account to practise trading with your chosen pairs before committing real money.
5. Monitor Trading Costs: Select pairs with narrow spreads to minimise transaction costs and improve profitability.

Conclusion

The most commonly traded forex pairs for beginners in China include USD/CNY, EUR/USD, and USD/JPY due to their high liquidity, predictability, and educational resources. Commodity-linked pairs like AUD/USD and NZD/USD also provide excellent opportunities for learning about market dynamics. By starting with these pairs and using sound risk management practices, beginners can build confidence and develop a strong foundation for successful forex trading.