A currency pair is a quotation of two different currencies, where one currency is exchanged for another. The first currency is called the base currency, while the second is the quote currency. For example, in the pair EUR/USD, the Euro is the base currency and the U.S. Dollar is the quote currency. The value of the pair indicates how much of the quote currency is needed to purchase one unit of the base currency. Currency pairs are essential in the foreign exchange (Forex) market, where traders buy and sell currencies. They are categorized into three types: major pairs, minor pairs, and exotic pairs. Major pairs, like USD/JPY, involve the most traded currencies, while minor pairs consist of less commonly traded currencies. Exotic pairs include one major currency and one from a developing economy, such as USD/TRY (U.S. Dollar/Turkish Lira).