Forex Market Basics Currency Pair

Forex Market Basics Currency Pair

The rule of the stock market is that the price of any share will be determined against the currency of that country. For example, in the stock market of our country, the price of a share is determined in rupees.

But in the forex market, it is impossible to determine the value of a country's currency. There can be no value in euros or dollars alone. For example: 83 Bangladeshi rupees is available with 1 dollar. This time it is possible to get only 0.80 Euros or 0.93 Australian Dollars with 1 dollar. Again, if you talk about the Japanese Yen, then with 1 dollar you will get 80 Yen. So, what is the value of the dollar? People from different countries trade in the Forex market, at what price will they buy dollars?

This is why everything in the Forex market is traded through currency pairs.

For example, EUR / USD (EUR / USD), a currency pair. Currently 1 EUR / USD = 1.4434. This means that with 1 euro you will get 1.4434 dollars. Oh, I forgot to say, USD = United States Dollar or American Dollar. Simply put, what we know as dollars.

Let's see some more currency pairs

1 AUD / USD = 1.0543, which means that with 1 Australian dollar you will get 1.0543 US dollars.

1 GBP / USD = 1.6422, which means that with 1 pound you will get 1.8422 USD.

1 NZD / USD = 0.8177, which means that with 1 New Zealand dollar you will get 0.618 USD.

1 USD / JPY = 80.29, which means that with 1 dollar you will get 80.29 Japanese Yen.

1 EUR / JPY = 115.91, which means that with 1 euro you get 115.91 Japanese Yen.

Now you understand the issue of currency pair?

Brother, what if I write a little twist? So you wrote that 1 EUR / USD = 1.4434 If I write USD / EUR instead of EUR / USD, is there a problem?

Of course not. But remember, the first currency of a currency pair indicates how much currency you will get next.

1 EUR / USD = 1.4434. This means that with 1 euro you will get 1.4434 dollars.

So, 1 USD / EUR will indicate how many Euros you will get with 1 dollar. The answer would be, just the opposite, 1 / 1.4434 or 0.698