We would find there do exist some differences whey they compare the spreads of each currency pair. Indeed, some pairs are more advantageous to trade than others. However, a 'larger' spread does not necessarily mean the pair is not as good for day trading when compared to some lower spread alternatives. Then how can traders make their choices among different currency pairs and choose the most proper one for as their day trading forexstrategy? As a day trading forex strategy, knowing which currency pair you should trade could possibly help maximize your profits. Stepping further, spread plays a rather important role in helping determine which currency pair is on earth the most proper for you.
No 1: Establishing a Base Line
To understand what we are dealing with, and which pairs are more suited in day trading forex strategy, traders need to establish a base line. For this the spread is converted to a percentage of the daily range. While the numbers below reflect the values in existence at a particular period of time, the test can be applied at any time to see which currency pair is offering the best value in terms of its spread to daily pip potential.
A change in the spread will affect the percentage. Please note that in the percentage calculation the spread has been deducted from the daily average range. This is to reflect that retail customers cannot buy at the lowest bid price of the day shown on their charts.
No 2: Which Pairs to Trade

When the spread is placed into percentage terms of the daily average move, it can be seen that the spread can be quite significant and have a large impact on day-trading strategies.
If you are an actively day trading forex trader and focusing on a certain pair, making trades each day, it is most likely you could trade pairs that have the lowest spread as a percentage of maximum pip potential. Usually the most liquid currency pairs have comparatively tight spreads, which maybe good choices for traders to trade.
No 3: Be realistic
The above calculations assumed that the daily range can be calculated and this is highly unlikely. Whatever level of forex trading skills you have at hand, you are not able to entirely tell what the range of the spread is, which is the most basic thing you should pay attention to when making a day trading forex strategy.
No 4: Conclusion:
Traders need to be aware that the spread represents a significant portion of the daily average range in many pairs. When factoring likely entry and exit prices the spread becomes even more significant. Day trading Forex traders, especially those trading on quite short time frames, can monitor daily average movements to verify if trading during low volatility times presents enough profit potential to realistically make active trading worthwhile. It is important to identify which currency pair is worthy of trading at the very first of your making a day trading forex trading strategy.