What are Cross Currency Pairs? - What are Minor Currency Pairs?

Currency Crosses

Cross currency pairs are the pairs that do not have USD and involve cross-currency transactions.

Example:

EUR JPY
GBPJPY
EUR GBP
AUDJPY
GBPCHF
EUR CHF
CHFJPY

To buy EURJPY you first buy EURUSD and then buy USD JPY.

This means to buy EURJPY you will have traded and transacted 2 other major currency pairs. This is why the majors have big turnover volumes because all minor currency pairs will involve these 2 majors.

This is because in the market you as a trader can not buy or sell the EUR directly for the JPY you have to convert EUR in to USD then using the USD you have to buy JPY. This is why these are called currency crosses because of the cross trade transactions using USD. This also is why USD takes up 85% of all trade transactions, because it's the base currency of all exchange transactions.

To buy GBPJPY you first buy GBPUSD and then buy USDJPY

This is also why the spread of these crosses is higher than that of the major currency pairs, because you'll be trading/transacting two transactions simultaneously when buying or selling these crosses.

Crosses are also not very liquid & thenceforth are not highly traded by most traders, this is why these Forex currencies will tend to have less predictable movements because their volumes of transaction turnover isn't very high.

Daily Trade Transactions Turnover of Currencies by Volumes

The USD is the most transacted, followed by EUR, GBP, JPY and CHF, the daily turnover volume share taken by each of these 5 in terms of percent is displayed below:

Major Forex Pairs

USD - 85%

EUR - 40 %

JPY - 20%

GBP - 13 %

CHF - 9%

Since transactions are in pairs the total will be 200 %

For example the EUR/USD pair: EURUSD = 100 percent EUR + 100 % USD

Summing up the total of the large 4 pairs = 85 + 40 + 20 + 13 + 9 = 167 % . Note these 4 are made up of 5 individual currencies which make up the sum total of 167%. This percent of the total turnover volume is what makes these 4 currency pairs to be referred to as major currency pairs or in short "majors". This lion share of the total turnover daily volume is also what makes these 4 the best currency pairs to trade especially among the Day Traders.

Therefore volume for Major currency pairs and Minor currency cross pairs is:

Forex Major Currency Pairs = 167 % of all trade trade transaction turnover in the market.

Other Minor Currency Pairs Combined = 33 % of all trade trade transaction turnover in the market.

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