In forex trading, all transactions involve two different currencies, and traders speculate on the price movement of one currency pair against another. Although trading is possible in almost all currencies in the forex market, the majors are most commonly traded. Traders can profit by speculating whether a currency’s value will appreciate or depreciate in relation to another currency.
The price of the most widely traded currency pair, the EUR/USD, represents how much of the U.S. dollar (quote currency) is required to buy one unit of the euro (base currency).
On trading platforms, prices indicate the value of one euro in US dollars. The two prices indicate the Buy price and the Sell price, with the spread representing the difference between the two prices. When you click Buy or Sell, the first currency in the pair is bought or sold.
