The difference between the BID and ASK price is called the SPREAD.

BID is the rate at which a dealer is ready to purchase the base currency.

BASIC CURRENCY is the currency against which the other currencies are quoted.

Similarly, it is important to know a little about the foreign exchange market so that when the day comes and you will be need to buy foreign currency to get that house of your dreams or anything else abroad, you are not at a disadvantage.

MARGIN CALL refers to a requirement for additional money, to make up the minimum cash deposit needed to cover any losses the client may encounter trading in the foreign exchange market. But you do need to know these fundamental words to be able to understand what they refer to when becoming a car driver otherwise life would be hard.

The foreign exchange market operates 24 hours per day.
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There are of course, many more terms used in the foreign currency business, but you have here a selection which will help you to know some of the basics.

The MARKET MAKERS make the profit from the spread.

CROSS RATES: This refers to currency pairs where the USD is not included like GBP/EUR or GBP/JPY

MARGIN refers to a deposit in cash required to cover the possibility of loss the client may encounter trading the foreign exchange.

BOTTOM: a description of a price decline meeting heavy support against further price decline.

Good luck. When the media talk about the foreign exchange market, it is the wholesale level they refer to.

Unlike the London Stock Exchange or the New clutch button suppliers York Stock Exchange centres, it has no fixed abode, but manages very well and is extremely active.

You do not have to be a mechanic to know some essential words about a car like the steering wheel, the hand brake, clutch pedal, the engine etc.

The FOREIGN EXCHANGE MARKET also called FOREX or FX, has no trading centre. These rates are aligned to the actual events taking place non stop in the market. Put these on one level. The time will come when some of us will need to make or receive a payment in a foreign currency.We come face to face with our local money every day.
The difference between these two levels is a wholesale and retail classification as existing in other trades.

There are hundreds of brokerage companies and banks, who deal between themselves including big corporations.

To jump this hurdle, we go to the bank to handle the currency exchange, or to a number of foreign currency exchange companies we can find on the internet, who will invariably quote far better rates of exchange.

Foreign exchange currency institutions have better access to obtaining a more advantageous rate of exchange than the ordinary small company or the man in the street.

VOLATILITY refers to the extent of price fluctuation