The Euro and Japanese Yen are two of the most commonly traded currencies in the world. The EUR/JPY pairing is often called “the euro” because it is made up of the euro and yen currencies.
The pairing has been popular with traders for a number of reasons, but one of the main reasons is that it offers traders exposure to two economies that are very different from each other.
The eurozone economy is much larger than Japan’s economy, so when traders buy euros, they are betting on the overall health of the eurozone economy. Conversely, when traders sell euros and buy yen, they are betting against the eurozone economy and expecting it to perform poorly relative to Japan’s economy. This makes trading EUR/JPY a way for investors to express their views on global economic conditions.
Another reason why this currency pair is popular among traders is because both currencies are considered safe havens during times of market volatility. When stocks or other risky assets fall in price, investors often flock to buying euros and yen as a way to protect their portfolios from further losses.
This means that movements in EUR/JPY can be quite volatile at times, which can make for interesting trading opportunities for those who understand how these markets work
