Why is GBP of strong interest to traders?

The British pound (the Sterling pound, or GBP) is one of the most attractive currencies in the world. The pound takes the 4th place in terms of turnover, as well as the third place as a reserve currency and obviously is one of the most popular currencies on the Forex market.

Why so aggressive?

Forex experts have long identified the British Pound as the most aggressive currency on Forex. Currency pairs which include GBP, such as GBP/USD, GBP/JPY, EUR/GBP are the most volatile on the market and their price fluctuations often exceed 150 points per trading session. That is why most traders are involved in trading these pairs during the American and European sessions.

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Trading GBP/USD currency pair

As I had said before, this trading instrument is very popular on the grounds of high volatility. By the way, GBP/USD currency pair refers to the currency majors on Forex. It is selected by scalpers, swing traders, day traders etc. The nicest situation on the market comes when one of this currencies can rise, while another one fall.

The movement of the GBP/USD quotes is influenced by fundamental factors such as:

  • the British pound and the US dollar interest rates’ comparison;
  • reports on inflation;
  • GDP and other indicators of economic activity;
  • retail sales;
  • changes in the unemployment rate;
  • speeches by the Governor of the Bank of England.

Interesting facts

  1. In the mid-19th century, the exchange rate between the U.S. dollar and British pound began to be transmitted across the Atlantic by a submarine communications cable. Since that time the exchange rate has been referred to as the cable.
  2. GBP/USD takes the 4th position in terms of trading volume on Forex and is one of the most liquid instruments. More than 13% of all orders opened on Forex account for GBP.
  3. All the relevant news is published during the European trading session. Follow the data from the US because they can significantly affect the GBP/USD rate.

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