Forex Trading Terminologies

1. carlos and company F o r e x T r a d i n g T e r m i n o l o g i e s CURRENCY PAIR A currency pair is the price of two distinct currencies. Two currencies form a combination with each other to show the price movement concerning each other. EXCHANGE RATE exchange rate compares the price of currency between the two nations. It means the value of one nation’s currency concerning another nation’s currency. BASE CURRENCY AND QUOTE CURRENCY As discussed above, two currency forms the combination with each other to form a currency pair. LONG POSITION AND SHORT POSITION Holding a long or short position in forex means trading on a currency pair to either go up or go down in value. BID PRICE AND ASK PRICE In forex trading, the bid price is termed as the rate, which a dealer is willing to pay for a currency. On the other hand, the ask price is the rate at which a dealer will sell the same currency. SPREAD Spread arises when the currencies are exchanged. The difference between the asking price of the seller and the bid price of the buyer is called the spread,hence, the difference in the selling rate of forex PIP LOT PIP stand for “percentage in points” or “price interest point”. It expresses the small measure or movement change in a currency pair in the forex. Do not get confused with a lot in the list of Forex trading terminologies. In simple words, a lot is a unit that measures the transaction amount. For more details, you may visit https://carlosandcompany.com/forex-trading-terminologies