Reading A Quote

Most beginner traders in the forex market are hardly coping up with how currency pairs are quoted. In this tutorial, we’ll discuss how currency pair work with trading.      

A currency quote is quoted in a pair. For instance, USD/CAD or USD/JPY. Currencies are quoted mainly because when buying a currency, you sell a different one too. Below is a sample forex quote for the U.S. dollar and Japanese yen.  

USD/JPY = 113.87

This is regarded as the standard format of a currency pair. The currency on the left is referred as the base currency, while the currency on the right is called as the quote or counter currency. The U.S. dollar or the base currency is always equivalent to one unit, and the counter currency is the equivalent of the other currency (JPY).

The sample quote suggests that if you desire to buy US$1, you would have to pay 113.87 yen. If in case you wanted to sell US$1, you would be receiving a 113.87 yen.

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