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A speculating trader buys a currency pair if he believes the base currency will increase with respect to the quote currency, or that the corresponding exchange rate will rise. Similarly, a speculating trader sells a currency pair with the hope that the base currency will decrease in value compared to the quote currency or the quote currency will increase with regards to the base currency. Forex trading often involves the simultaneous buying of one currency and selling of another. Therefore, when you buy a currency pair, you buy the base currency and sell the quote currency. The “bid” is the price at which you can sell the base currency at the same time of buying the quote currency. The “ask” is the price at which you can buy the base currency at the same time of selling the quote currency.
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When a deal is finalized, this is known as a "spot deal".
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