Previous: How Money is Made Trading FX

As you may have noticed, the symbols (abbreviations) for all currencies have three letters. The first two letters denote the name of the country and third letter stands for the name of that country’s currency.

As an example, let’s look at the USD. The US stands for United States and the D stands Dollar.

The currencies on which the majority of traders focus are called the “majors”. The most widely traded currencies are represented on the grid below:

Currency Names and Symbols

Not to be confused with major currencies are the major currency pairs. The Major Pairs are any currency pair with USD in them. For example, the EURUSD would be considered a Major Pair.

Currency Names and Symbols

Currency pairs without the USD in them are referred to as Cross Pairs. The EURJPY would be an example of a Cross Pair.

Currency Names and Symbols

To carry this one step further, any EUR pair without the USD in it would be referred to as a Euro Cross. So the EURJPY would be a member of the EURO Cross group. Other member of that group would be EURGBP, EURCHF, EURNZD, EURCAD and EURAUD.

Other currency groups of this type would be comprised of the JPY crosses, GBP crosses, AUD crosses, NZD crosses and the CHF crosses.

Next: The Long and Short of It (Forex Jargon) - Part 4 of 5