🧱 Basics·beginner

Currency Pair

Two currencies quoted together — you're always buying one and selling the other at the same time.

A currency pair is how forex quotes work: EUR/USD, GBP/JPY, USD/CAD. The first currency is the "base" and the second is the "quote." When you buy EUR/USD, you're buying euros and paying with dollars. When you sell, you're doing the opposite. The price tells you how much of the quote currency it takes to buy one unit of the base. EUR/USD at 1.0950 means 1 euro = 1.0950 US dollars. If the price rises to 1.1000, the euro got stronger against the dollar (or the dollar got weaker against the euro — same thing). Pairs are grouped into majors (USD on one side, very liquid, tight spreads), minors (major currencies without USD like EUR/GBP), and exotics (a major vs a less-traded currency like USD/ZAR). Beginners should start on majors.

Real trade example

During the 2022 USD rally, almost every pair with USD as the quote (EUR/USD, GBP/USD, AUD/USD) fell 15-20% while pairs with USD as the base (USD/JPY, USD/CHF) rallied hard.

Related terms

Pip

beginner

The smallest standard price move in a currency pair — the building block of every forex profit or loss.

Base Currency

beginner

The first currency in a forex pair — the one you're buying or selling, priced in units of the second currency.

Quote Currency

beginner

The second currency in a forex pair — the one used to price one unit of the base currency.

Exotic Pair

advanced

A forex pair that includes one major currency and one currency from a smaller or emerging-market economy — like USD/TRY or USD/ZAR.

Major Pair

beginner

Any forex pair that includes the US dollar and one other top-tier global currency — the most liquid pairs in the world.

Minor Pair

intermediate

A forex pair made up of two major currencies that does NOT include the US dollar — like EUR/GBP or AUD/JPY.

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