As a general rule,each currency has a three letters symbol, which is used in Forex quotes.The first two letters identify the name of the country while the third letter identifies the name of that country’s currency.For example:AUD (Australian dollars),JPY (Japanese yen),CHF(swiss francs) and CAD (canadian dollars). When trading currencies, the trade is always done in pairs and so when you buy one currency, another currency is simultaneously being sold.
The most commonly traded currency pairs are:-
• Euro and US Dollar (EUR/USD)
• US Dollar and the Japanese Yen (USD/JPY)
• US Dollar and Swiss franc (USD/CHF)
• British Pound and US Dollar (GBP/USD)
The most commonly traded currency pairs are made from the most common and actively traded currencies which are called the “Majors”. The list of currencies below consists of the Majors
• USD (US dollars)
• EUR (European Euros)
• GBP (United Kingdom pounds)
• JPY (Japanese yen)
• AUD (Australian dollars)
• CHF (Swiss francs)
• CAD (Canadian dollars)
When quoting currency pairs, the first currency is referred to as the Base currency while the second referred to as the Counter or Quote currency. The currency pair is used to represent how much Quote currency is required to exchange for the base currency. In a direct quote, the quote currency is the foreign currency.
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