Inside Trade | The Cable – GBP/USD tandem

The British Pound (GBP) and US dollar currency pair is one of the most popular currency pair traded in the Exchange Market. It is ranked 3rd on the list of the most traded currency pair worldwide, with Europe as its turf; particularly in Great Britain. The daily trading turnover averagely reaches 12% of the total Forex market turnover.

But there are certain characteristics that makes it unattractive for some traders; the fluctuations are short-term and unstable. It has an average daily fluctuation of 130 points. It is also the reason why it got its alter name, Cable.

The low liquidity of this pair is visible in the Asian region with only an average movement of only 30 points. Most often, it goes with the same direction as EUR/USD that is why most prefer to trade with this currency pair rather than the Cable.

The direction of the GBP/USD and EUR/USD may only alter when a “Cable' news is released. It often moves against the news even if its a favorable news. The substantial difference in interest rates of pound and dollar makes it good for swap trading.