Explaining forex tradin

International Trade, or Forex, refers to the currency exchange process between countries. It’s popular because traders can profit from it. For beginners, understanding Forex quotes can be tricky, but it’s based on two main parts. The first currency is the base currency, which is always valued at 1.

The US dollar is the core of the Forex market, serving as the base currency for all quotes. Major currencies include the USD, Japanese Yen, UK Pound, and Chinese Yuan. The exchange rate indicates how much of the second currency you can get for $1. If the quote increases, the US dollar is getting stronger, meaning it can buy more of the other currency.

Three exceptions exist where currencies are expressed differently: the British Pound (GBP/USD), the Australian Dollar (AUD/USD), and the Euro (EUR/USD). If the dollar in these pairs weakens, it indicates a decrease in its value.

In Forex trading, you will encounter two-sided quotes, meaning you will see both a bid and an ask price. The bid is what buyers pay for the base currency, while the ask is the price to acquire it.

To succeed in Forex trading, you need to understand the market well. One great aspect of Forex is that there’s always a market open somewhere in the world, allowing you to trade at any time, no matter where you are.