Currencies are always traded in sets. Per instance, if you want to trade your US dollars(USD) for British pounds(GBP) then your currency pair get USD/GBP, the currency on the left being the base currency. The fundamental currencies being traded on the Currency markets right now are the Japanese yen, the us dollar, the British pound, the Swiss frank, the Euro, the Canadian dollar, the Australian dollar and the Nz dollar. These currencies are what most pairs comprise of. The US dollar will be part of most pairs, by simply cooking you would like to trade, let's say, Australian dollars for Japanese yens, regarding pair would be called an exotic pair and should only be traded by experts through these markets.

So, an individual trades using what are since lot options. A lot size can be $10,000, $100,000, etc. For instance the power of forex trading, to show ahead of time how small of a price movement you should make hundreds of dollars each day, I will use $100,000 lot capacity. Let's say that we trade $100,000 lot, and that the price 1 currency compared to another moves up to.0020. Now that number to your left is really a fraction associated with an cent, however it's known to be a 20 pip movement.

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[url=http://theforexbank.com/understanding-pivot-points-in-forex.html;Understanding Pivot Points in Forex]Understanding Pivot Points in Forex[/url]