Currency pairs are represented by two ISO codes plus a separator, such as GBP/USD, where the first code stands for "basic currency" and the other stands for "auxiliary currency".
The most frequently traded currency in the most common currency market is called "major currency". Most currencies are bought and sold against the dollar. The dollar is the most frequently traded currency. ?
The next five currencies in intraday trading are:? Euro; Japanese yen (JPY); British pound (GBP); Swiss francs and Australian dollars. These six major currencies account for 90% of the global foreign exchange market.
The mainstream currency pairs in the foreign exchange market are mainly currency pairs containing US dollars, such as Euro/US dollar, Pound/US dollar, Australian dollar/US dollar and so on.
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The exchange rate changes quickly. Supply and demand in the market determine the value of money, and the value of one currency in the foreign exchange market is expressed by another currency. In a currency pair, the first currency is called "base currency" and the second currency is called "valuation currency" or "relative currency".
When you trade currencies, you buy the benchmark currency and sell the denominated currency. The exchange rate tells the buyer the cost of buying a unit of base currency. The order of currency pairs is usually unchanged, which is a common practice in the industry. ?
For example, the currency pair USD/JPY(USD is the base currency and JPY is the pricing currency). The order of the currency pairs you see will not change. Therefore, buying or selling depends on the direction of the transaction. For example: USD/JPY-You can buy JPY with USD or USD with JPY.
For example: Euro/USD 1.2500 means you need to spend 1.25 USD to buy1. It can also be said that if you sell 1 euro, you will get 1.25 dollars. All transactions involve buying one currency and selling another.
If the euro appreciates against the US dollar the next day and the exchange rate becomes 1.26, then every euro you bought will bring you 1 cent. If you trade in the opposite direction, every euro you originally sold (1.25) will bring you a loss of 1 cent (because you need to "buy back" 1 euro at this time).
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