Currency pairs
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Currency pairs
What are currency pairs?
The foreign exchange (Forex) market is recognized as the most extensive and liquid financial market globally. One of the key attractions for traders is its round-the-clock operation, allowing trading 24 hours a day. In Forex, participants engage in the exchange of one currency for another, forming currency pairs such as the British pound paired with the U.S. dollar, denoted as GBP/USD. The initial currency in any pair is the base currency, while the second is the quote currency.
In Forex markets, the value of a currency pair indicates the amount of the quote currency needed to purchase a single unit of the base currency. Currencies are identified by a three-letter ISO currency code—for instance, EUR for the euro, JPY for the Japanese yen, and USD for the U.S. dollar.
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