A pair with the euro as base and a non-dollar currency as quote, such as EUR/GBP, EUR/CHF, EUR/JPY or EUR/PLN.
Euro crosses let a trader isolate a European story without taking a dollar view. If the euro is expected to outperform sterling, EUR/GBP expresses it directly, whereas trading EUR/USD also bets on the dollar.
Liquidity varies widely across the group. EUR/GBP and EUR/JPY are deep; EUR/HUF, EUR/PLN and EUR/TRY are thin, carry wide spreads and gap around central bank meetings. See emerging-market-currency.
Example: a view that the euro gains 2% on sterling can be taken in EUR/GBP for roughly 1 pip of spread, or built from EUR/USD and GBP/USD for about 0.7 pips across two positions plus double the used-margin.
Original diagrams for the ideas on this page. Illustrative, not real market data.
The bid-ask spread. Buy orders sit below, sell orders above, and the gap between the best bid (50.01) and best ask (50.04) is the spread you pay to cross. Bar length shows the size resting at each price.
Educational only, not advice. Spotted an error? Post in Site Feedback.