#TradingPairs101 ✅

is an educational label that introduces the concept of trading pairs, fundamental in both the cryptocurrency market and the foreign exchange market (Forex). Understanding how these pairs work is essential for effectively buying and selling assets.

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🔄 What is a trading pair?

A trading pair represents two assets that can be exchanged for one another on an exchange platform. In the context of cryptocurrencies, a pair like BTC/ETH indicates that you can exchange Bitcoin for Ethereum and vice versa. In Forex, a pair like EUR/USD shows how many US dollars (USD) are needed to buy one euro (EUR). The first asset is called the base currency, and the second is the quote currency.

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💱 Types of trading pairs

📈 In Forex:

• Major pairs: Include the USD and are the most liquid, such as EUR/USD or USD/JPY.

• Minor pairs: Do not include the USD, such as EUR/GBP or AUD/NZD.

• Exotic pairs: Combine a major currency with one from an emerging economy, such as USD/MXN.

🪙 In cryptocurrencies:

• Fiat to crypto: For example, BTC/USD or ETH/EUR.

• Crypto to crypto: Like BTC/ETH or LTC/DOGE.

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🧠 Why are trading pairs important?

• Access to assets: Some assets are only available through certain pairs.

• Price determination: Pairs show the value relationship between two assets.

• Trading strategies: Allow you to take advantage of price differences between correlated assets.

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📊 Practical example

Let’s say the BTC/ETH pair has a rate of 15. This means that 1 BTC is equivalent to 15 ETH. If you believe that the relative value of BTC will increase compared to ETH, you could exchange ETH for BTC expecting to benefit from that variation.