A cross pair (also called a cross-currency pair or simply a “cross”) is any forex currency pair where neither currency is the US dollar. EUR/GBP, EUR/JPY, GBP/JPY, AUD/JPY, and EUR/CHF are the most actively traded examples, and EUR/JPY and GBP/JPY consistently rank in the top 10 most-traded pairs globally according to the BIS Triennial Survey. Crosses exist so traders can take positions on relative currency strength without simultaneously taking on USD exposure.
Key Takeaways
- Cross pair spreads are typically 2-5x wider than equivalent majors because pricing requires triangulation through the USD — EUR/GBP retails at 1-2 pips versus 0.1-0.5 pips for EUR/USD.
- Pip values differ significantly across crosses: one pip on EUR/GBP is approximately $12.50 on a standard lot, while EUR/JPY is approximately $6.80-$7.20 — each pair must be tracked separately in a journal.
- GBP/JPY averages 100-200 pips of daily range versus 40-70 pips for EUR/GBP, so volatility profiles vary dramatically even within the same cross category.
How Cross Pairs Work
Because the USD is the world’s reserve currency and the anchor of most interbank pricing, any pair that excludes it must be derived through a triangular calculation. EUR/JPY, for example, is effectively EUR/USD divided by USD/JPY:
EUR/JPY = EUR/USD ÷ USD/JPY
If EUR/USD is 1.0850 and USD/JPY is 157.00, then EUR/JPY = 1.0850 ÷ 157.00 × 100 (scaling) ≈ 170.35. This triangulation is handled automatically by brokers, but it has a direct cost consequence: liquidity on each leg must combine, and the result is wider spreads. A retail EUR/GBP spread of 1-2 pips compares unfavorably to EUR/USD at 0.1-0.5 pips — a cost premium of 3-10x in relative terms.
Cross pairs also respond differently to macro news. USD-driven events like Non-Farm Payrolls or FOMC rate decisions have an indirect effect on crosses through their impact on both constituent currencies simultaneously. A trader long EUR/GBP during NFP is exposed to whatever the release does to EUR/USD and GBP/USD independently — and those moves can partially cancel out or amplify depending on direction.
AUD/JPY deserves specific mention as a widely-tracked risk sentiment proxy. It tends to fall sharply during global equity selloffs as traders unwind carry trades (borrowing low-yield JPY to buy higher-yield AUD). Monitoring AUD/JPY is a useful macro signal even for traders who don’t trade it directly.
Practical Example
A trader anticipates a weak UK CPI print and wants to short GBP relative to EUR. Rather than selling GBP/USD — which would add USD exposure ahead of unrelated US data — they buy EUR/GBP at 0.8550, targeting 0.8600 (+50 pips), with a stop at 0.8520 (-30 pips).
On a 0.5 standard lot, each pip on EUR/GBP is worth approximately $6.25 (half of the ~$12.50 standard lot value):
- Target profit: 50 pips × $6.25 = $312
- Max risk: 30 pips × $6.25 = $187
- Spread cost: 2 pips × $6.25 = $12.50 — logged as an entry cost that reduces net R
In their trading journal, the trader must record the pip value as EUR/GBP-specific. Using the EUR/USD pip value by mistake would overstate the position’s dollar risk by nearly double. The spread cost of $12.50 also shifts the effective risk from $187 to $199.50, reducing the trade’s R:R from 1.67 to approximately 1.56.
A cross pair is a forex currency pair that does not include the US dollar. Examples include EUR/GBP, EUR/JPY, and GBP/JPY. Cross pairs allow traders to express views on two currencies directly, but typically carry wider spreads and different pip values than dollar pairs.
Common Mistakes When Trading Cross Pairs
- Using the wrong pip value. EUR/JPY and EUR/GBP have meaningfully different pip values in a USD account. Applying the same dollar-per-pip figure across all crosses distorts risk calculations and makes journal statistics unreliable.
- Ignoring the spread cost premium. A 2-pip spread on EUR/GBP costs $25 round-trip on a standard lot — not negligible on a 50-pip target. Traders who journal spread costs only for majors will understate their true costs on crosses.
- Misreading the volatility profile. Treating GBP/JPY (100-200 pip daily range) the same as EUR/GBP (40-70 pip daily range) when sizing positions leads to either over-exposure or unnecessarily tight stops.
- Ignoring indirect USD correlation. Cross pairs still respond to USD news through their component currencies. A strong NFP number can move EUR/JPY significantly even though neither currency is USD — understanding which leg is more sensitive matters for managing open cross trades around high-impact events.
How PipJournal Tracks Cross Pairs
PipJournal calculates pip values per pair automatically, ensuring that EUR/GBP and EUR/JPY trades are correctly converted to USD P&L in your account currency without manual adjustment. Spread costs are logged at entry so your net R per trade reflects the actual cost of execution, not just the distance to your stop. When reviewing pair-specific performance, cross pairs appear separately from majors so you can identify whether your edge is stronger on currency pairs with or without USD involvement.
