Euro and Yen Crosses: The Most Liquid After the U.S. Dollar
After the U.S. dollar, the euro (EUR) and Japanese yen (JPY) are the most traded currencies in the forex market. Like the USD, they are also held by central banks as reserve currencies.
Because of this, EUR and JPY crosses (pairs that don’t include the USD) are the most liquid non-USD pairs.
Trading Euro Crosses
The most popular euro cross pairs are:
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EUR/JPY
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EUR/GBP
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EUR/CHF
News related to the euro or Swiss franc will usually impact these crosses more strongly than it would affect EUR/USD or USD/CHF.
For example:
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U.K. economic news will move EUR/GBP significantly.
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Swiss data will impact EUR/CHF.
Strangely enough, U.S. economic news can also influence EUR crosses—even if USD isn’t in the pair!
Here’s how:
Imagine the U.S. releases strong data:
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USD strengthens.
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GBP/USD falls → GBP weakens → EUR/GBP rises.
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USD/CHF rises → CHF weakens → EUR/CHF rises.
So even though the U.S. dollar isn’t in these euro crosses, its strength or weakness can still affect them indirectly.
Trading Yen Crosses
The yen is involved in many popular cross pairs and is widely traded.
The most active yen cross is EUR/JPY, according to the Bank for International Settlements.
Other popular JPY crosses include:
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GBP/JPY
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AUD/JPY
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NZD/JPY
These are favored in carry trades because the interest rate differences between these currencies and the yen are often high.
💡 Always monitor USD/JPY when trading any yen cross. It’s like the “leader of the pack.” If USD/JPY breaks a key support or resistance level, the move often spills over into other JPY crosses.
For example:
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If USD/JPY breaks above resistance, traders are selling the yen.
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You might then see EUR/JPY, GBP/JPY, and AUD/JPY all move higher too.
The CAD/JPY and Oil Connection
CAD/JPY has become a popular currency cross in recent years due to its strong link with oil prices.
Why?
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Canada has the world’s second-largest oil reserves and profits when oil prices go up.
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Japan, on the other hand, imports over 99% of its oil since it has almost no domestic production.
This creates a strong positive correlation (around 87%) between oil prices and the CAD/JPY exchange rate.
So when oil prices rise, CAD/JPY often rises too—and vice versa.