While Before going to trade in currencies you must understand currency pairs.
So they are most popular in Forex trading so sometimes it surprises me when I asked a question to many investors about currency pairs.
But they failed to answer above asked question about currency pairs why I surprised because they invested the huge amount of money and wasted many years in forex but they don’t know what is currency pairs.
so watch below picture and video.
So you must learn basic, advance and Professional Forex. Then Invest your money otherwise leave this business because it is not suitable for any investor.
What is Currency Pairs?
So currency pairs are the foundation of Forex trading they are paired up and then compare.
The first currency in the pair is the base currency and the second currency is the quote currency, or sometimes counter currency.
If it requires buying one unit of the base currency by above-mentioned rate, For example, GBP / USD = 1.6567 indicates that you can buy one unit of a pound by 1.6567 US dollars.
When selling a currency pair, the exchange rate shows how many units of the quote currency you will receive when selling one unit of the base currency.
The bid price is the rate that your broker is willing to pay for the currency pair, in other words, this is the rate you receive if selling to the market.
The ask price is the rate at which your broker is willing to sell and represents the rate you must pay to buy the currency pair.
The bid price is always less than the ask price because brokers pay less than they receive for the same currency pair.
This difference – known as the spread– is how your broker generates much of its revenue.
The illustration at the top of this line shows how brokers typically display a currency pair to show the current bid and ask price.
In this example, the bid is 1.3272 dollars to each euro, while the ask is 1.3276 dollars to each euro.
What are the Major Currency Pairs
Major currency pairs are involving the US Dollar. The euro versus the U.S and The U.S. dollar versus the Japanese yen (USD/JPY) is another popular pair.
In addition, all seven of these pairs have the US dollar as one of the currencies in the pair.
The US dollar accounts for over 95% of Forex trades in the market. The seven most commonly traded currency pairs can be grouped into “Majors”.
What is the Cross Currency Pairs
They do not include the US dollar are commonly referred as Cross Pairs.
And some of them move very slowly and trend very well and another move very quickly and extremely volatile.
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