Forex trading education - Currency Pairs, Buying And Selling Rates

In foreign currency trading there are always currency pairs – the base currency and the counter currency.

The base currency – it is in essence our product, it is denoted on the left side of the pair. We always buy or sell the base currency.

The counter currency – it is the means of payment and is denoted on the right side of the pair. In a transaction involving the EUR/USD I buy or sell the Euro against the USD wherein the means of my payment is the USD.

The exchange rate is the price of one unit of the base currency in terms of the counter currency.

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