Reading forex quotes is the first technical skill every trader needs. If you can quickly interpret a quote, you’ll know which currency you’re buying or selling, how profit/loss is calculated, and how broker pricing works. This guide breaks everything down with practical examples and simple language so you can act with confidence.

What is a Forex Quote?

A forex quote shows the price of one currency expressed in another currency. Quotes always come in pairs — a base currency and a quote currency — and look like this:

EUR/USD = 1.1025

In this example, 1 Euro (EUR) equals 1.1025 US Dollars (USD). If you buy EUR/USD, you are buying Euros and selling US Dollars. If you sell EUR/USD, you are selling Euros and buying US Dollars.

Base Currency vs Quote Currency

The base currency is the first currency in the pair — it is the currency you are buying or selling. The quote currency is the second currency — it shows how much of that currency is needed to buy one unit of the base currency.

• Buy (Long) EUR/USD: You expect EUR to strengthen vs USD. You buy EUR, sell USD.
• Sell (Short) EUR/USD: You expect EUR to weaken vs USD. You sell EUR, buy USD.

Bid and Ask — The Two Prices You Must Know

Market quotes include two prices: the bid and the ask.

• Bid — the price at which the market (or broker) will buy the base currency from you (your sell price).
• Ask — the price at which the market (or broker) will sell the base currency to you (your buy price).

Example:

EUR/USD 1.1022 / 1.1025  — bid 1.1022, ask 1.1025

If you click “Buy” you pay the ask (1.1025). If you click “Sell” you receive the bid (1.1022). The difference (0.0003 in this example) is the spread — the broker’s built-in cost.

Pips and Pipettes — Measuring Price Movement

A pip is the standard unit of movement in forex quotes. For most currency pairs, a pip is the fourth decimal place (0.0001). For pairs quoted to five decimals, the extra digit is a pipette.

EUR/USD: 1.1025 → 1.1035 = 10 pips

Knowing pip value is essential for calculating profit and loss. Pip value depends on your trade size (lots) and the currency pair.

Lots and Position Size

Forex trades use standardized sizes called lots:

• Standard lot: 100,000 units
• Mini lot: 10,000 units
• Micro lot: 1,000 units

Example: If you buy 1 standard lot of EUR/USD, you buy 100,000 EUR. If EUR/USD moves 10 pips and each pip is worth $10 for a standard lot, your profit/loss is $100.

Understanding Crosses and Major Pairs

Major pairs always include the US Dollar (USD) — e.g., EUR/USD, GBP/USD, USD/JPY. Crosses are currency pairs that do not include the USD, such as EUR/GBP or AUD/JPY. Crosses are useful when you want exposure between two non-USD currencies.

How to Read Quotes with Examples

Let’s look at practical steps you can use on any trading platform:

1. Find the pair: Locate EUR/USD (example).
2. Check bid/ask: If quote shows 1.1022 / 1.1025, know which price applies to buy and sell.
3. Decide direction: Buy if you believe EUR will strengthen vs USD; Sell if you expect weakness.
4. Set risk size: Choose lot size and use stop-loss to limit downside in pips.

Buy 0.10 lot EUR/USD at 1.1025
Stop-loss 1.0995 (30 pips)
Take-profit 1.1085 (60 pips)
Pip value (micro/mini/standard) determines P/L

Swap, Rollover & Overnight Fees

If you hold leveraged forex positions overnight, brokers may charge or pay a swap (rollover) based on interest rate differences between the two currencies. This can affect longer-term position profitability.

Common Quote Formats and Shortcuts

Some platforms use shorthand or different decimal precision. Be comfortable reading:

• JPY pairs quoted to 2 decimals (e.g., USD/JPY 150.25)
• Some brokers show only the mid-price or hide decimals — always expand the quote to see bid/ask

Practical Tips for Beginners

• Always check bid/ask: You want to know the spread and execution price before entering.
• Use demo accounts: Practice reading quotes and placing trades without risk.
• Start small: Use micro lots until pip value and risk feel natural.
• Watch high-impact news: Economic releases can widen spreads and cause slippage.
• Prefer liquid hours: Trade during session overlaps (London/New York) for tighter spreads.

How RFXSignals Can Help

If you’re still learning how to read quotes, using well-structured trade signals can remove confusion. At RFXSignals we send signals that include:

• Precise entry price (and whether to buy or sell)
• Stop-loss in pips and price
• Take-profit targets with risk/reward
• Suggested lot sizes or risk percentage

Frequently Asked Questions (FAQ)

Q: Is the quote always accurate?

A: Quotes from regulated brokers are accurate, but may differ slightly between brokers. Always use your broker’s live feed.

Q: Why do bids and asks change so quickly?

A: Forex is highly liquid and moves based on news, order flow, and liquidity provider pricing — which is normal.

Q: Are pip values the same for every account?

A: No — pip value depends on pair, lot size, and account currency. Many platforms calculate it automatically for you.

Conclusion — Reading Quotes with Confidence

Reading forex quotes becomes second nature with practice. Focus on these basics: identify base vs quote currency, know bid/ask and spread, understand pip math and lot sizes, and check the session/market liquidity. Use trade signals from a trusted provider like RFXSignals while you practice — they remove guesswork and help you learn by doing.

Ready to see accurate, easy-to-follow forex quotes turned into trades? Start with RFXSignals