What Is the Difference Between EUR/USD and EUR/USD (OTC)?


Novice traders are often so full of enthusiasm that they are ready to trade currency pairs not only on working days but also on weekends. However, in this case, when looking at quotes on their broker’s platform, they notice the abbreviation OTC, which is not present on weekdays. What does this mean and is it worth trading in this case?

OTC Makes Trading Possible Even on Weekends

Exchanges are financial institutions that, like many others, close for the weekend. It means that currency pairs quotes during this period cannot be found. Over-The-Counter (OTC) deals are concluded without the mediation of exchanges. To fulfill them, traders can use the dealer network. When trading on the exchange, a currency pair has a different cost for selling and buying. In the case of OTC trading, this cost is the same for both operations. Take a look at the Euro USD currency pair price chart on the capital.com platform to get real-time information about its change.

Who Can Trade EUR/USD (OTC)?

Any trader who has registered on a broker platform has the opportunity to trade EUR/USD (OTC) currency pairs. However, should anyone do it?

  • It is recommended to refrain from trading on the weekends for beginners.
  • It is not recommended to trade large volumes of currencies with OTC quotes.
  • As they gain experience, traders can trade profitably regardless of the day of the week.

Moreover, they feel free in the OTC markets without the risk of incurring large losses.

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Opportunities and Risks of Trading EUR/USD (OTC)

Opportunities of trading EUR/USD (OTC) Risks of trading EUR/USD (OTC)
  • Independence from the opening hours of centralized exchanges.
  • The absence of sharp volatility on the charts of currency pairs, which makes trading more predictable.
  • Fundamental factors, such as the political and economic news agenda, do not affect OTC charts on weekends.
  • Greater trading flexibility, which allows you to more freely realize your trading goals.
  • OTC trading is more difficult to regulate, which means that fraud is more likely here.
  • OTC quotes may be far from real, which becomes obvious with the start of the working week.
  • Unscrupulous brokers may use the OTC quotes for fraudulent purposes.


Most Popular OTC Market for EUR/USD Trading

The most famous and popular platform for trading currency pairs without the mediation of exchanges is Forex. It can be accessed through the Capital.com app. That is why EUR/USD (OTC) trading here is possible 24 hours a day, 7 days a week. Other benefits of Forex are:

  • Low entry threshold for traders.
  • Ability to use high leverage.
  • Possibility to profit both from the growth and fall of the value of a particular currency.
  • High liquidity due to the popularity of Forex among traders worldwide.

Each trader independently chooses which way of trading is closer to them: using exchanges as intermediaries or not. The first method gives greater guarantees, and the second — more freedom and flexibility. Therefore, as they gain experience, traders increasingly prefer the second option, which gives them the opportunity to experiment with different strategies and trading styles.

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