JustChartsHow to Read a Forex Quote: Base, Quote, Bid and Ask
A forex quote shows how much of the second (quote) currency it costs to buy one unit of the first (base) currency. EUR/USD 1.0850 means €1 costs $1.0850. Quotes come as two prices: the bid (what you get if you sell) and the ask (what you pay if you buy); the gap between them is the spread.
Key facts
- Base currency
- the first one — the unit being priced
- Quote currency
- the second one — the price is in this
- Bid
- price you sell at
- Ask (offer)
- price you buy at
- Decimals
- 4 or 5 for most pairs; 2 or 3 for yen pairs
Base and quote currency
In GBP/USD 1.2700, the pound is the base currency and the dollar is the quote currency: one pound costs 1.27 dollars. If the number rises, the base currency has strengthened against the quote currency; if it falls, it has weakened.
- Buying GBP/USD = buying pounds and selling dollars. You profit if the price rises.
- Selling GBP/USD = selling pounds and buying dollars. You profit if the price falls.
Bid and ask
Platforms show two prices, for example 1.27002 / 1.27012:
- The bid (1.27002) is where you can sell.
- The ask (1.27012) is where you can buy.
- The difference — here 1 pip — is the spread.
Charts usually plot the bid price, so a buy order can fill slightly above the price you see on the chart.
Reading the decimals
| Quote | Pip position | Last digit |
|---|---|---|
| EUR/USD 1.08503 | 4th decimal (0.0001) | Pipette (0.00001) |
| USD/JPY 151.247 | 2nd decimal (0.01) | Pipette (0.001) |
| XAU/USD 2,412.35 | Broker-defined | $0.01 step |
How to invert a quote
To see the rate the other way round, divide 1 by the quote: if EUR/USD is 1.0850, then USD/EUR is 1 ÷ 1.0850 = 0.9217 — one dollar buys about €0.92.
Cross rates
Pairs without the dollar, such as EUR/GBP, are cross rates. Their price is consistent with the dollar pairs: EUR/GBP ≈ EUR/USD ÷ GBP/USD. If EUR/USD is 1.0850 and GBP/USD is 1.2700, EUR/GBP ≈ 0.8543.
Frequently asked questions
What does EUR/USD 1.10 mean?
One euro is worth 1.10 US dollars. The euro is the base currency and the dollar is the quote currency.
Do I buy at the bid or the ask?
You buy at the ask (the higher price) and sell at the bid (the lower price).
Why does the price on the chart differ from my entry?
Most charts show the bid price. Buy orders fill at the ask, which is higher by the spread.
Put it into practice
Live charts, an economic calendar and trading calculators — free with a JustCharts account.
See live quotes on the chartThis article is for education only and is not financial advice. Trading leveraged products carries a high risk of losing money. Contract sizes, trading hours and leverage limits vary by broker and country — always check your own broker’s specifications.