Forex Trading

Forex trading, or currency trading, or FX trading, as it can be also abbreviated, are all terms that describe the currency exchange market as we know it today, which in simple language refers to the global, decentralized marketplace where individuals, companies and financial institutions exchange currencies for one another at floating rates. It is one of the largest, most liquid markets in the world with an average daily trading volume exceeding $5 trillion. Forex trading allows you to buy and sell currencies 24 hours a day and five days a week.

Currency Pairs

Instrument Symbol Instrument Name
EURUSD Euro vs US Dollar
USDJPY US Dollar vs Japanese Yen
GBPUSD British Pound vs US Dollar
AUDUSD Australian Dollar vs US Dollar
USDCAD US Dollar vs Canadian Dollar
USDCHF US Dollar vs Swiss Franc
NZDUSD New Zealand Dollar vs US Dollar
USDMXN US Dollar vs Mexican Peso
USDRUB US Dollar vs Russian Ruble

Trading Currencies

Currencies are traded in pairs and these pairs fall under three categories; Majors, Minors and Exotics.

Major Currency Pairs

The Majors are the most popular and most liquid pairs and always have the US dollar as one half of the pair. Examples include the EUR/USD and the USD/JPY.

Minor Currency Pairs

The Minors are the pairs which do not include the US dollar, but contain the remaining major currencies; the EUR, JPY and GBP. The Minors have also been nicknamed 'Crosses'. Examples include the EUR/CHF and the EUR/GBP.

Exotic Currency Pairs

The Exotics currency pairs are made up of a major currency pair coupled with the currency of a developing economy. Examples include the USD/HKD and the USD/NOK.

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