Reading a currency pair
A currency pair expresses one currency in terms of another. In EUR/USD, EUR is the base currency and USD is the quote currency. A rise in the quoted price means one euro buys more dollars.
A simple example
If an illustrative EUR/USD quote moves from 1.1000 to 1.1010, the change is 0.0010, or ten conventional pips. Whether a position gains or loses depends on its direction, size, execution prices and costs. These numbers are examples, not current prices.
From a quote to a trade
Buying a pair expresses a view that the base currency will strengthen relative to the quote currency; selling expresses the opposite view. Leveraged products add margin requirements and the possibility of rapid losses.
Try this in demo
Find a currency symbol, identify its bid and ask, and read its contract specification. Record the position size and spread before placing a practice order. Review the result after costs rather than focusing only on the chart.
Frequently asked
Does a demo result predict a live result?
No. Live execution, costs and the experience of risking money can differ from a simulation.
Further reading
CFTC: Foreign currency trading risks ↗External educational references do not imply endorsement, affiliation or regulation of QB Capitals.
Leveraged forex and CFDs involve significant risk of loss. Demo results do not predict live performance. Understand the risks ↗