Foreign Exchange (FX) is trading one currency for another. For example, when you see a quote of 114.63 JPY/USD it means that if you wanted to buy Japanese Yen (¥) you could buy 114.63 ¥ for each US dollar ($).
Most FX quotes are made in terms of units of currency per US dollar. The exceptions are most of the countries of the British Commonwealth. Great Britain Pounds (£), Australian Dollars and New Zealand Dollar are all quoted in terms of units of currency per £, AUD, or NZD. Another exception is the Euro (€). It is also quoted in units of currency per €.
Let me illustrate what I mean. I will give three typical quotes below. The first is the way most currencies are quoted. The next two are the way the € and £ are quoted.
114.63 JPY/USD
1.214 USD/EURO
1.7758 USD/GBP
All currencies are quoted with a bid and an offer. To avoid confusion, just remember that you will always be on the side that results in you spending the most or receiving the least when you buy or sell. When you see a quote on a screen, the bid is how much they are willing to pay to buy the currency. The offer is how much they want from you to sell their currency. They make their money on the bid offer spread plus a margin since you are a retail and not a wholesale customer.
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