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The base currency is the first currency in a pair, and the quote currency is the second. In EUR/USD at 1.1000, the euro is the base and the price says one euro costs 1.10 US dollars.
Every pair has two parts. The base currency comes first and is always worth one unit. The quote currency comes second and shows what that one unit costs. GBP/JPY at 190.00 means one pound costs 190 yen. USD/CAD at 1.3500 means one US dollar costs 1.35 Canadian dollars.
When you buy a pair you buy the base currency and sell the quote currency. Buy EUR/USD and you own euros, paid for with dollars. Sell EUR/USD and it is the other way round. Your profit or loss is counted in the quote currency, which is why a pip on a standard lot of EUR/USD is worth $10.
You buy 10,000 units of EUR/USD at 1.1000, so you hold 10,000 euros. The pair moves to 1.1050. Your euros are now worth 11,050 dollars instead of 11,000, a gain of $50. If your account is in euros, the broker converts that $50 at the current rate.
Your broker also uses the words base currency for the currency your account is kept in. Pick the currency you deposit and withdraw in, because every conversion costs a spread. A trader paid in pounds who keeps a dollar account pays to convert twice.
See spread for the gap between the two prices you are quoted, and micro lot for the smallest size most brokers allow.
The euro. The price shows how many US dollars one euro costs.
It stays fixed. Market convention sets the order. EUR comes first against every currency, GBP comes before USD, and USD comes before JPY, CAD and CHF.
Sources: Market convention as described in bank FX glossaries, for example the CLS and BIS terminology pages. Checked 25 September 2026.
Risk warning: trading forex and CFDs on margin carries a high risk of losing money. Most retail accounts lose money. Never trade with money you cannot afford to lose.