EUR/USD

(EUR=)

One of the most closely watched currency pairs today is EUR/USD – also called the euro-dollar. This forex pair is particularly interesting in light of Brexit and the US-China tensions. Find out how you can take advantage of EUR/USD price movements with IG.

EUR/USD chart This market's chart. This is a visual representation of the price action in the market, over a certain period of time. You can use this to help gauge a market’s performance.

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  • CFD
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Details for EUR/USD -

Dealing

Minimum size 1

Contract size EUR 100,000

One Pip means 0.0001 USD/EUR

Value of one Pip USD 10 (GBP 7.74)

Margin 3.33%

Minimum stop distance 2

Minimum guaranteed stop distance 5

Margin

Your aggregate position in this market will be margined in the following tiers:

Tier Position size Margin
1 0 - 11.5 Contracts 3.33%
2 11.5 - 115 Contracts 3.33%
3 115 - 172.5 Contracts 3.33%
4 172.5 + Contracts 4%

If your aggregate position is larger than Tier 1, your margin requirement will not be reduced by non-guaranteed stops.

Please note: we have tried to ensure that the information here is as accurate as possible, but it is intended for guidance only and any errors will not be binding on us.

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EUR/USD from 0.6 points

Other positions taken by clients trading this market

Use this to see how IG client accounts with positions on this market are trading other markets. Data is calculated to the nearest 1%, and updated automatically every 15 minutes.

This is calculated to the nearest 1%.

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FAQs

What should I watch out for when trading euro-dollar?

When trading euro-dollar, you should watch out for economic reports, political events and monetary policies that move the price of EUR/USD. Recurring events such as European Central Bank (ECB) and Federal Reserve Bank announcements, as well as developments concerning Brexit and US-China trade discussions impact the price of euro-dollar.

You can trade EUR/USD by opening a spread betting or CFD trading account. Note that the price of EUR/USD represents how many dollars you would need to sell to buy one euro. So, if the price quote is 1.10385, it means that €1 costs just over $1.10. You can go long or short on EUR/USD, which means you can trade upward or downward price movements.

When is the best time to trade EUR/USD?

The best time to trade EUR/USD is when both markets are open (between 1pm and 4pm UK time). During this open period, EUR/USD tends to be more liquid and spreads are generally tighter. Outside of these times, there tends to be more volatility, which could also provide opportunities to profit.

What are the best EUR/USD trading strategies?

The best EUR/USD trading strategies to use will depend on your personal trading style. There are many forex strategies to choose from, enabling you to determine when it’s time to enter and exit a trade. These include the RSI indicator strategy, momentum indicator strategy and breakout trading strategy.

Discover EUR/USD trading strategies

What is the history of EUR/USD?

EUR/USD (or euro-dollar) does not have a very long history, as the euro only came into existence as a digital currency in January 1999 and a physical currency in 2002. However, this young forex pair quickly became the most popular by trading volume.

When the euro was introduced in its physical form, 11 European currencies were combined, abolishing the Franc, Deutschmark, Peseta and Lir a, among others. At this time, the euro’s exchange rate against the dollar was 1.1686 and many believed that EUR could overtake USD as the world’s official reserve currency.

Countries started to do more business with each other after the euro’s introduction due to the lack of currency risk, with the resultant rise in gross domestic product (GDP) growth across the eurozone causing EUR/USD’s price to surge. The years 2008 to 2014 were marked by economic crises – first in the US and then in the eurozone – which played havoc with EUR/USD’s price. While the Fed looked to increase interest rates in response to a strengthening economy after 2008, the ECB had to keep interest rates low and introduce a quantitative easing programme to boost spending in Europe.

In 2016, when Britain voted to leave the EU, EUR/USD tumbled. The same happened when Trump won the US elections later that year. The uncertainty surrounding the final Brexit deal continues to affect euro pricing, with Britain expected to leave the EU in October 2019. A ‘hard Brexit’ (no deal) is likely to have a negative impact on the euro, whereas a ‘soft Brexit’ (in which the UK and EU maintain close ties) could limit the impact or even strengthen the euro.

As of 2019, USD is the primary reserve currency. The euro – now used by 19 EU countries – is the second largest, with the Japanese yen (JPY) in third place and the pound (GBP) in fourth.

How can I trade Brexit volatility with EUR/USD?

You can trade Brexit volatility with EUR/USD via an IG CFD trading or spread betting account. CFDs and spread bets enable you to speculate on markets that are rising as well as falling. Both are derivative products, which means you only have to put up a small deposit – called margin – to gain exposure to the full value of the trade. While this may increase your profits, it could also magnify your losses.

Read more about Brexit and trading volatility

How can I profit from trading EUR/USD?

You can profit from trading EUR/USD if you trade the currency pair via spread bets or CFDs. If you think that EUR is going to increase against USD, you would buy the pair (go long). If you think that the euro will decrease in value against the US dollar, you would sell the pair (go short). Your profit or loss will depend on how accurate your prediction is, meaning it is possible to profit whichever way the market moves.

Why is EUR/USD referred to as ‘euro-dollar’?

EUR/USD is referred to as ‘euro-dollar’ because it’s the pairing of the euro – the currency of 19 European countries – and the US dollar. It shows how many dollars it costs to buy one euro. EUR is the currency code for the euro and USD is the currency code for the US dollar.

Are the euro and US dollar safe currencies?

You could say that the euro and the US dollar are safe currencies, because both have traditionally been viewed as ‘safe havens’. However, forex is a volatile market and currency values fluctuate continuously. So, whether EUR and USD are safe currencies will always depend on liquidity, volatility and economic events (such as Brexit).

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1 By number of primary relationships with FX traders (Investment Trends UK Leveraged Trading Report released July 2019).
2 Based on revenue excluding FX (published half-yearly financial statements, June 2019)

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