A quote like EUR/USD = 1.08 looks cryptic until you know the two simple roles every currency in a pair plays.
Base and quote
In any pair, the first currency is the base and the second is the quote (or counter). The price tells you how much of the quote currency it takes to buy one unit of the base.
So EUR/USD = 1.08 means one euro costs $1.08. The euro is what you’re pricing; the dollar is what you’re pricing it in.
Reading a move
- If EUR/USD rises to 1.10, the euro got stronger — it now takes more dollars to buy one. (Equivalently, the dollar weakened.)
- If it falls to 1.05, the euro weakened against the dollar.
A rising pair always means the base currency strengthened against the quote.
The bid and the ask
Like any market, FX has two prices at once: the bid (what a buyer will pay) and the ask (what a seller will accept). You buy the base at the ask and sell it at the bid. The small gap between them — the spread — is the cost of trading, and it’s the subject of the next lesson.
The takeaway
A pair like EUR/USD has a base (first) and a quote (second); the price is how much quote buys one base unit. A rising pair means the base strengthened, and the bid/ask gap is what you pay to trade. (This is education, not investment advice.)