Currency volatility varies depending on market opening hours, economic news announcements, liquidity, etc. Studying volatility can be a criterion for selecting currency pairs to trade based on a specific trading style or time frame. For example, short-term traders such as scalpers will choose currency pairs that offer low spreads and high volatility.
What is volatility in forex trading?
Volatility is a term used to describe the statistical variation in trading prices. In the table below, the higher the number, the higher the volatility or market movement, and thus profits or losses can increase rapidly. Conversely, the lower the number, the lower the volatility, often indicating market stagnation.
How is volatility measured?
Volatility is the difference between the high and low price values in a symbol. Some traders use indicators to measure volatility such as the Average True Range (ATR), Bollinger Bands, or Standard Deviation. However, in the table below, you can quickly compare multiple symbols across different time frames, thus saving time.
Note: I have displayed volatility in both percentages and pips. Percentages are preferred as they are more accurate for comparing currency movements against each other.
The table below represents the average daily, hourly, and weekly volatility for various currency pairs.
Currency Pair Volatility in Pips
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