Plain-language definitions of the currency market terms you meet while trading forex pairs.
Pairs
| Term | What it means |
|---|
| Currency pair | Two currencies quoted against each other, such as EUR/USD. |
| Base currency | The first currency in a pair. |
| Quote currency | The second currency in a pair. |
| Major pair | A pair involving the most heavily traded currencies. |
| Cross pair | A pair that does not involve the US dollar. |
Movement
| Term | What it means |
|---|
| Pip | The standard small unit of price movement in a pair. |
| Spread | The gap between the buy and sell price. |
| Session | A regional trading period, such as the London or New York session. |
| Volatility | How much and how quickly price moves. See what is market volatility. |
Trading them
| Term | What it means |
|---|
| OTC forex | A currency market quoted around the clock, tradable at weekends. |
| Commodity currency | A currency whose economy is closely tied to commodity exports. |
| Safe haven | A currency that tends to attract demand in uncertain periods. |
Putting it into practice
Definitions stick faster when you see them in use. Open a demo account — virtual funds, no deposit — and these terms stop being abstract within minutes.