USD/HKD Trading Tutorial

A currency pair is a binary interactive quotation of two distinct currency units. It is expressed as a currency unit value compared to another value. This relative value fluctuates, which makes trading over these currency pairs potentially profitable or loss-making.

The USD/HKD currency pair can be an excellent choice for both new and professional traders. Its fixed range bound system makes it much safer. This tutorial will guide you through all the features of USD/HKD trading. After that, we will uncover some tried and proven trading strategies that work best with this pair.

Key Takeaways

Using leverage while forex trading can greatly increase income and pose a tremendous risk.
HKD is pegged to the USD under a short trading range. Pegging makes It safer from loss but harder to generate profit.
Chinese economy highly influences HKD, so HKD can work as a gateway to enter the Chinese economy.
Hong Kong’s political unrest can negatively affect USD/HKD trading.
NFP trading strategies can be integrated with any other trading strategies to maximize gains.
HKD’s liquidity and low-interest rates make it highly fitting for carrying treading.
There is a slight possibility that HKD will become obsolete in the future.

Understanding USD/HKD


The US Dollars or USD speaks for itself. It is the most exchanged currency around the globe and also the most popular reserve currency. The American economy is recognized as very reliable and stable worldwide, even in periods of instability. So among the form of money, USD is regarded as a safe heaven.


Hong Kong Dollars or HKD is The cash of Hong Kong. The Hong Kong Monetary Authority(HKMA) regulates it and has granted it full autonomy.

Hong Kong is one of the top financial centers worldwide. It has a free economy, nominal interest rates and is the 6th largest stock market globally. So Hong Kong is a lovely place for foreign expenditure, Making HKD the ninth most exchanged currency worldwide.

As China surrounds Hong Kong, the Chinese economy and geopolitical events significantly influence HKD. HKD can be a gateway to the Chinese economy.

HKD is pegged to USD in a compact trading range. The range is currently between 7.7500 HKD to 7.8500 HKD per USD. When the HKD touches the minimum or maximum cap, the HKMA steps in to balance the currency. The HKMA has more than 450 billion US Dollars worth of foreign reserves to prevent any pursuit from breaking the peg with USD.

Pros and cons of Trading USD/HKD


Accessing Chinese Economy: Hong Kong’s economy is closely related to China. China currently collects more than half of Hong Kong’s exports. Issues that have an impact on Hong Kong’s economy also impact the Chinese economy.

The Chinese economy is the second-largest economy in the world. USD/HKD pair can provide a relatively easy way to engage in the Chinese economy.

Liquidity: HKD is one of the most exchanged currencies in the world. So USD/HKD pair secures high liquidity, which means rapid selling and buying over placing orders. This liquidity also makes investments over other assets easier and less risky.

Low Risk: Pegging of the USD/HKD pair reduces the risk of loss. Having a lower limit allows traders to operate in safe parameters.

Pullback Trading Strategy

A pullback is the exchange rate withdrawal against the ongoing trend. You may use the pullbacks to obtain HKD cheaply and sell them at a relatively higher rate. A pullback is a method of successfully utilizing the trends to make a profit.

To use this technique, you need to distinguish a trend and have a Fibonacci Retracement Indicator.

First, recognize a trend and wait for a pullback. Right after the pullback takes place, position the Fibonacci Retracement Indicator between the last swing, high and low levels.

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Will HKD eventually become obsolete?

Some experts do argue that increasing Chinese influence over Hong Kong may one day make HKD redundant. But there are a lot of experts against this argument too. And even if this happens, it will be a long-term process.


USD/HKD trading can be lucrative in many ways, and you can use many trading strategies with this pair. This pair is less risky, beginner-friendly, and compatible with a wide range of techniques. We hope this article will help you trade like a pro and generate more profit.