Currency Pairs

Before going on and opening a trading account, you also need to know what currency pairs are. They are one of the most essential elements in the online forex trading system. As its name implies, currency pairs are two sets of currencies paired up together. A currency pair looks like this: EUR/USD. As always, these currency pairs are separated by a slash. In this case, you are talking about how many US dollars are there in one euro.

You can select among various currency pairs in the forex trading system. There are seven major currencies that are most commonly traded. These include: EUR, USD, JPY, CHF, GBP, AUD, and CAD. Currencies that are not on the top seven list are all considered minor currencies.

There is also a certain pair that is called a cross currency pair. These are the currencies in forex trading that does not include USD in the pair. When you do your trading, you may notice that some currencies are not available for buying and selling. So before deciding to join a certain a trading site for forex, better check it out first.

Basically, the one situated on the left side of a currency pair is called the base currency. Usually, the USD is the base currency with the exceptions of currencies such as EUR and AUD. The one on the right side is called the quote currency. This tells how much you have gained or lost on your online forex trading transaction.