Forex trading is buying one currency and selling in another I.e., you can buy a currency and it can be sold in another currency with the help of a broker/dealer.
Currency pair can be called as a price quote of the rate of exchange for two different currencies that are traded in the FX market. The first currency of the currency pair is bought and the currency that is listed on the second number is sold.
Whenever you trade on forex then you have to trade in pairs. The rate of trading keeps on changing depending upon the stronger currency at that moment.
The currency pairs are mainly classified into three:
● Major currency pairs
● Crosses currency pairs
● Exotic currency pairs
Major currency pair
The currency pairs that are traded heavily are the major pairs in the forex market. The four major currency pairs include USD/JPY, USD/CHF, EUR/USD, GBP/USD.
The major currencies are part of the g10 currency group and are also easily deliverable. These currency pairs are mainly used in a large number of economic transactions. This pair of currencies are also used for various trading purposes too.
The major currencies are said to be the most liquid ones in the whole world. Liquidity stands for the activity level in the financial market.
In forex, the liquidity is based on the figure of the active buyers and the sellers of the particular currency pair and also the amount of its trading. The more frequently trading is the more will be its liquidity.
The forex trade is made up of 75% major pair of currency. The major pairs have the most liquidity and is traded broadly in the forex market. In all the FX trades the major currencies make up the vast majority.
The major currencies make up the majority of the forex trading but minor ones should also not be ignored or underestimated. The minor currencies are also known as the cross-currency pairs. The minor currency pairs include the pairs such as EUR/CHF, EUR/GBP, GBP/JPY.
Exotic currency pairs
The exotic currencies are those type of currencies that are exchanged thinly in the market of foreign exchange but it is not used universally for financial transactions. The exotic currencies are not so liquid and are difficult to exchange too. The exotic currencies are traded at very low volume because exchanging these types of currencies are expensive.
Forex trading course
As you enter the world of foreign trading there are many loss and profits. The traders can also find themselves irritated after the loss of huge capital. Even if you are a professional trader then also you can face loss due to the market.
There are various forex trading courses that will help you to understand the terms of trading and also trading in a profitable way.
● Online lessons
● Private training
Characteristics of a good trading course
● Always consider the reputation of the course. The views of people on that course will help you a lot to make a decision that is good for you or not.
● Course certification
● Cost and time.