Currency pairs or CROSS
It is important to know that the forex market it is impossible to buy or sell a currency independently from each other. The price of a currency can appreciate that in terms of another currency. Example: the euro may rise against the dollar but it can lower against the Swiss Franc.
Become familiar with the names of currencies
On the foreign exchange market, each currency is identified by an abstract of 3 letters. While the first two letters reveal the name of the country, the third letter specifies the name of the currency.
• USD United States Dollar
• EURO representing an economic zone is an exception and is named EUR.
• GBP Great Britain Pound
The most common currencies: the majors.
In the jargon of Forex, you often hear about pairs of major and exotic currencies. Anyway, all currencies are traded against the US dollar (USD), which is also the most traded currency in the foreign exchange market. Come next in the euro (EUR), Japanese yen (JPY), British pound (GBP), Swiss franc (CHF) and finally, the Australian dollar (AUD) representing 90% of trading volume traded daily . The pair of most traded currency in the financial markets remains the EUR / USD.
A word about the notions of Listing and parities
Consider trading EUR / USD = 1.1600
The motto is listed first on the left of the cross currency (EUR) is called the base currency. The value of the base currency is always 1. In contrast, the value of another currency, on the right (here USD) is called counter currency. Only a symbol between the two currencies
Buy and sell on the currency market
You understand now the currency pair will deal only, which means that you can not only buy or sell but a share purchase or sale produces another.
EXAMPLE: If I buy the Euro (Base Currency), this means that I sell the dollar (currency Counterparty) and vice versa: Consider a parity that is traded EUR / USD = 1.1600 this means that with 1000 euros I buy 1160 dollars.
To start trading on the EUR / USD, contact the experts at Invest Alpha Patrimoine: