Watch as many or as few as you are comfortable with. I currently watch around 40 markets 20 of which are currencies. I also like to track the main fx drivers usdx, gbpx, chfx, jpyx, eurx. The other markets are either stock index's or commodities.
I feel it depends on various things such as trading style, timeframe, etc etc.. I focus on Eur/Usd, but sometimes watch Usd/Jpy. Reason is EurUsd moves a lot and has low spread. Jpy has been moving lately and also has low spread. For my style it's much easier with the lowest spread. If I were to go out a little longer, as I tried before, I would watch GbpUsd and EurChf since they both trend nicely.
I prefer to watch only one pair at a time regardless. It allows me to focus and get a better feeling for what's going on.