Think of buying a currency as buying a share in a particular country , kinda like buying shares in a company.
The price of the currency is usually a direct reflection of the market's opinion on the current and the future health of its respective economy.
In Forex trading, when you buy, say, the Japanese yen, you are basically buying a "Share" in the Japanese economy.
You are betting that the Japanese economy is doing well, and will even get better as time goes.
Once you sell those "shares" back to the market, hopefully, you end up with profits.
In general, the exchange rate of the currency versus other currencies is a reflection of the condition of that country's economy , compared to other economies.
By the time you graduate from the this school of pipsology, you'll be eager to start working with currencies
While there are potentially lots of currencies you can trade as a new forex trader, you will probably start trading with the " major currencies "
They are called a major currency because they're the most heavily traded currencies and represent some of the world's largest economies.
Forex traders differ on what they consider as major currencies.
The uptight ones who probably got straight a's and followed all the rules as the children only consider USD, EUR, JPY, GBP and CHF as a major currency
Then they label AUD, NZD and CAD as a commodity currency
For us rebels, and to keep thing simple, we just consider all eight currencies as a "major"
Below , we list them by their symbol, country where they're used, currency name and cool nicknames.
Currency Symbols always have three letters, where the first two letters identified the name of the country nd the third letter identifies the name of that country's currency, usually the first letter pf the currency's name
Take NZD for instance....
NZ stands for newzealand,while D stands for ollar.
The currencies include in the chart above are called the majprs beacuse they are the mot widely traded ones
We'd also like to let you know that "buck isn't the only nickname for usd.
There's also: greenbacks,bones,benjis,benjamins,cheddar,paper,loot,scrilla,cheese,bread,moolah,dead presidants and cash money.