Hey there! Have you been hearing about Forex Trading and wondering what the fuss is all about? Well, look no further! This article aims to demystify Forex Trading Basics for you. Let’s break it down and make it as simple as possible. Here, we will walk through the basics of forex trading, and by the end of this article, you should be able to comprehend what Forex Trading really is and how it works. Let’s dive right in!
What is Forex Trading?
The Basics of Forex Trading: Currency Pairs and Exchange Rate
Now that we understand what Forex Trading is, let’s take a closer look at the basics of trading forex. It all revolves around currency pairs and exchange rates. Consider the US dollar/European Union currency exchange rate.
One currency (the USD) serves as the “base currency,” while the other (the EUR) serves as the “quote currency.” The quote currency exchange rate is the amount of the quote currency that can be purchased with one unit of the base currency.