Forex, short for foreign exchange, is the global market where currencies are traded. When you trade forex, you exchange one currency for another, aiming to profit from movements in the exchange rate between them.
Currency pairs
Currencies are always traded in pairs: you buy one currency while simultaneously selling another. The exchange rate reflects how much of the second currency is needed to buy one unit of the first, and price movements in either direction can produce a profit or a loss depending on your position.
Forex trading terminology
Forex trading has its own vocabulary, covering concepts such as pips, spreads, leverage, margin calls, and hedging. Understanding these terms—and how currency pairs move—is central to trading forex successfully.
