Since the U.S. dollar is the centerpiece of the market, the currency is normally considered the "base" for quotes. In the "large", this includes USD / JPY, USD / CHF and USD / CAD. For these and many other currencies, the prices are expressed as a unit of $ 1 USD per the second currency quoted in the pair. For example, a budget of USD / JPY 123.50 means that one U.S. dollar a equal to 123.50 Japanese.
When the U.S. dollar is the basic unit and a currency quote goes up, it means the dollar has appreciated in value and the other currency has weakened. If the USD / JPY listed above budget be increased to 124.01, this would mean that the dollar is stronger because it will now buy more yen than before. Some exceptions to this rule are the British pound (GBP), Australian dollar (AUD) and the Euro (EUR). In these cases, you see a quote such as GBP / USD 1.4366, meaning that one British pound equals U.S.
$ 1.4366. In these three pairs currency, where the U.S. dollar is not the base rate, a budget increase means a weakening dollar, and now has over U.S. $ to equal one pound, euro or Australian dollar. Thus, if a currency quote goes up, which increases the value of the base currency. A lower quote means the base currency is weakening. Currency pairs that do not include the U.S. dollar are called cross currencies, but the premise is the same. For example, a quote of EUR / JPY 127.95 means that one euro is equal to 127.95 Japanese. Chuck Cox is a technical writer and Industrial scientific professionals with experience in statistics. He has used mathematical and statistical methods to invest and trade in shares, futures, and options markets. Chuck has owned various businesses and presently operates several websites. To investigate a new business idea, visit their website