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In the international market, the Foreign
Exchange rate is demonstrated by five numerals, for example:
EUR/USD 1.2653
USD/JPY 107.65
GBP/JPY 195.03
The Exchange Rate Change
The exchange rate smallest change for the final figure (is 1 pip),
for example:
The EUR/USD smallest change is 0.0001
USD/JPY smallest change is 0.01
Quoted Price
All quoted prices can be divided into direct quoted price and
the indirect quoted price, for example:
The direct quoted price currency includes: EUR/USD, GBP/USD, AUD/USD,
NZD/USD ......
The indirect quoted price currency includes: USD/JPY, USD/CHF,
USD/CAD ....
For example, the EUR/USD quoted price is 1.2653, which means each
euro could convert to 1.2653 US dollars, while the USD/JPY quoted
price is 107.65, which means that each US dollar could convert
to 107.65 Japanese Yen.
The buying price and the selling price of the foreign currency
is decided by the bank or the broker house, customer decides only
the buying trend. For example, the EUR/USD quoted price general
demonstration is 1.2652/57, which means the broker house is willing
to buy Euro dollar at the price of 1.2652, and sell at the price
of 1.2657. At this time, the price difference between the buyer
and the seller (pip difference) is 5 pips, for foreign exchange
trading, the smaller the point means the trading cost is lower
and the chance of profit making is much larger.
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