Currencies Are Traded against One Another in Forex Market

It is money in different currencies that you trade in forex market. You trade forex by buying one currency and at the same time selling another currency. The currencies are traded through a forex broker in pairs, such as EUR/USD. Here the currency pair EUR/USD means the relative value of euro(EUR) against the US dollar(USD). If you buy EUR/USD, that means you buy in Euros and at the same time sell Us Dollars.

The most traded currency pairs in the world are called the Majors. They are EUR/USD, USD/JPY, GBP/USD, AUD/USD, USD/CHF and USD/CAD, involving the major currencies euro(EUR), US dollar(USD), Japanese yen(JPY), pound sterling(GBP), Australian dollar(AUD), Canadian dollar(CAD), and the Swiss franc(CHF). About 85% of forex market volumes are traded between the Majors.

Do you live abroad or often travel to other countries? If your answer is yes, then you may have the experience to exchange currencies. In these cases, you exchange currencies for your own use, because you need to pay local currency for goods and services when you are abroad. However, what I will point out here is that YOU CAN ALSO MAKE MONEY WITH FOREX TRADING.

For those who don’t familiar with forex trading, a brief definition is needed here: the Term Forex is derived from the words Foreign and Exchange, also known as foreign exchange market, FX market and currency market, is the market where one currency is traded for another.