The Currencies Being Traded On The Forex Market

In theory there is no limitation on the currencies which can be traded on the Forex market but, in reality, the market will only support currencies for which there is both a supply and demand.

By far and away the most traded currency is the US dollar which appears in about 90% of all trades. If this figure seems unbelievably high then, as we will see in a minute, each trade must involve two currencies and thus the total of market activity would add up to 200% and not the 100% you might expect.

Aside from the US dollar the other major currencies traded are the Euro, the Japanese Yen, the Pound Sterling and the Swiss Franc. In many of the examples we give throughout this course we will normally include the US dollar as one side of the trade simply because it is the market's dominant currency.

Unlike may other markets in which you simply buy or sell the security in question, there must be two sides to every Forex trade (a currency that is bought and a currency that is sold) and the first thing we need to learn is the language used when referring to particular currencies and the manner in which prices are quoted for both buying and selling.

Currencies are denoted using the ISO (International Standardization Organization) international currency codes which, for example, denote the US dollar as USD, the Euro as EUR, the Japanese Yen as JPY, the Pound Sterling as GBP and the Swiss Franc as CHF. This is important in understanding forex trading systems

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Independent Online
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The common currency was at Y100.03 from Y100.20 Speculators had mixed views toward the impact the US jobs data could have on the market, following the Federal Open Market Committee's extension last week of its easy money policy. Kengo Suzuk...