The quote is simply the record of a previous transaction in which a currency pair changed hands. Upon downloading and opening the software of your chosen forex broker, the first concept that you will encounter is the forex price quote.

How to Read and Understand a Currency Quote In the case of stocks, or commodities, the value can only be indicated in USD therefore it is possible to speak of an absolute value. The result of this is that it is impossible to speak of absolute value in the forex market because it is possible to value the Euro in dollars, Francs, or Yen, each being a valid choice as a value indicator. But when the forex trader buys or sells the Euro, he must pay for it with another currency (Australian dollar, Swiss Franc, etc) in which case the quote created has the same asset class on both sides. For example, when the currency trader buys an ounce of gold, he must pay for it with the US dollar, which creates a quote in which the price of the metal is defined in terms of a currency which is another asset class. As a result, unlike in the commodity, each currency’s value is determined relative to another. In the forex (currency trading) market the assets bought and sold are currencies themselves. In the commodity market traders buy and sell assets like oil or gold in exchange for currencies. Part 8:Forex Trading Psychology: The Four Demons of Trading Psychologyįorex trading is a form of commodity trading.Part 5:Fundamental Analysis vs Technical Analysis.Part 4:Currency Pairs and Their Characteristics.Part 3: Forex Order types - Mechanics of Online Forex Trading.Part 2: What are Forex Pips, Lots, Margin and Leverage.

Forex Lessons in this Forex Trading Course

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