#TradingPairs101
Trading Pairs :
A pairing of two currencies or assets compared to each other in terms of value when trading.
Example EUR/USD = Euro against Dollar.
EUR is the base currency.
( Base Currency ) and USD is the quote currency ( Quote Currency )
Common types of trading pairs:
Foreign exchange pairs ( Forex Pairs ) that are most traded globally and are divided into major pairs ( Majors ): such as EUR/USD - GBP/USD
USD/JPY ( includes the US Dollar ).
- Minor pairs ( Minors ): such as EUR/GBP - AUD/CAD ( do not include the Dollar ).
- Exotic pairs ( Exotics ): such as USD/TRY ( Dollar against Turkish Lira ).
Cryptocurrency pairs ( Crypto Pairs ) such as:
- Stable/crypto pair: BTC/USDT ( Bitcoin against Tether ).
- Crypto/crypto pair: ETH/BTC ( Ethereum against Bitcoin ).
Commodity pairs (Commodity Pairs)
such as: XAU/USD ( Gold against Dollar ) or OIL/USD ( Oil against Dollar ).
Advantages of trading in pairs:
- Diversity of opportunities: Thousands of pairs between crypto currencies.
- Relative analysis: Understanding the strength of one asset against another ( such as comparing BTC to ETH ).
- Flexibility: Buying or selling in both directions ( price rising or falling ).
Risks you should know about:
- Sharp fluctuations: Especially in cryptocurrency or exotic pairs.
- Leverage risks ( Leverage ): It can amplify profits or amplify losses.
- Low liquidity: Some minor pairs are difficult to sell quickly due to low liquidity and lack of demand.
