Trading Paired Asian Currencies in the FX Market

03-Aug-2019 Intellasia | ZUU online | 6:02 AM Print This Post

Foreign exchange trading can offer an excellent way to boost your investment returns. One of the most significant advantages of FX trading is that it’s possible to get significant returns on a relatively small investment.

How does that work?

If you open a forex trading account with Phillip Futures, you can leverage your trades. In other words, you need to put up only a small fraction of the trade amount as your margin. So, for example, with a margin of S$1,000, you could enter into a trade valued at 10 or 20 times that amount.

In practical terms, this allows you to magnify your profits ten-fold or twenty-fold. However, leverage is a double-edged sword. A trade that moves in the wrong direction could multiply your losses in the same proportion.

If you are new to trading, it may be a good idea to register for the one-to-one coaching provided by the experts on Phillip Futures’ panel.

An issue that many investors who are new to foreign exchange trading face is that they are not sure about which currency pairs to target. Several Asian currencies currently offer lucrative trading opportunities.

Let’s examine five currency pairs to gain an understanding of the market.


The USDCNH pair refers to the US dollar against the offshore Chinese Renminbi. Despite the recent slowdown, China’s economy is still growing at a respectable pace. Its GDP is currently advancing at a rate that is in excess of 6 percent per year. That’s several times greater than the percentage in most western economies. However, the ongoing trade war with the US could result in a slowdown.

The USDCNH pair has relatively low trading volumes. Consequently, price movements could be easier to predict, providing for profitable trading opportunities.


Japan is the world’s third-largest economy. Its export market includes the US, China, Europe, and many other countries. As a result, there is strong demand for the Japanese yen, which is known by its abbreviation, JPY.

USDJPY is the second most popular currency pair in the foreign exchange markets. Only euro USD has higher volumes.

The Japanese economy has been undergoing a protracted slowdown for several decades. This is the result of two main factors. One, in the early 1990s, asset prices in the country collapsed. Equity valuations and the real estate market saw steep declines. Secondly, the country has an ageing population, and its restrictive immigration policy exacerbates this problem.

When you are trading USDJPY, it’s essential to keep these issues in mind.


Singapore has one of the most successful economies in the world. Per capita GDP stands at $93,900 on a purchasing power parity (PPP) basis. That’s significantly higher than that of most other developed countries. Exports from the “little red dot” are 173 percent of GDP, again one of the highest percentages in the world.

The USDSGD currency pair presents plenty of opportunities for forex traders. The value of the Singapore dollar relative to the US dollar can be affected by several factors, including the US-China trade war, oil prices, and the political situation in South East Asia.


The Hong Kong Dollar gains its importance as the Hong Kong Special Administrative Region (SAR) is considered to be the gateway to China, the world’s #2 economy. Many international firms choose to make Hong Kong their base when planning a foray into the Chinese market.

It’s important to remember that USDHKD trades within a narrow range as the Hong Kong Monetary Authority closely administers it.


The value of the Thai Baht stems from Thailand’s export-led economy and robust tourism sector. However, in recent times, GDP growth has slumped because of a drop in demand for the country’s products. Thailand’s electronics producers and the auto sector have borne the brunt of the slowdown.

In the first quarter of 2019, gross domestic product grew by a paltry 2.8 percent. That’s a sharp reduction from Q12018′s 3.6 percent.

Another problem that Thailand faces is its growing external debt. However, these factors add to the Baht’s volatility, creating opportunities for forex traders.

Boost your profits with Phillip MetaTrader 5

If you are to succeed at FX trading, it is crucial that you use an efficient and powerful trading platform.

Phillip MetaTrader 5 ticks all the boxes. It is available on desktop, mobile, and web and is compatible with Windows and MAC OS. In addition to this, here are some of the other benefits that you get if you choose Phillip MetaTrader 5:

Zero commission and low spreads on your FX trades Phillip Futures offers some of the lowest spreads in the market. This helps to maximise your profits.

Automated trading you can create your own automated trading algorithm. When you do this, you no longer have to worry about tracking the market on a minute-by-minute basis. The automated system that you have created takes care of this.

Access to the Autochartist MT5 Plugin Scan the markets continuously using Autochartist, an advanced pattern recognition tool that is integrated with Phillip MetaTrader 5.

An opportunity to trade different order sizes With Phillip MetaTrader 5, you can trade in micro, mini, or standard lots.

The bottom line

FX trading is not a “get rich quick” investment scheme. You are not going to become wealthy overnight by entering into trades on the foreign exchange market. In fact, if you intend to make easy money without much effort, it may be better to stay away from trading forex.

However, it’s entirely possible to grow your initial investment slowly and steadily. Familiarise yourself with the FX Market Outlook and set up your Forex Trading Game Plan. Remember that you will not win with every trade. Even professional traders make both winning and losing trades. What’s important is to have more winners than losers.

By choosing Phillip Futures and the Phillip MetaTrader 5 platform, you can start on the right foot. After this, it’s just a matter of tracking the forex market carefully and maintaining a disciplined trading approach.


Category: FinanceAsia

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