Forex trading, also commonly known as “FX trading” simply means currency trading. In other words, merchants participate in the market by determining the price of one currency against another currency. It is much simpler than it seems. For example, if you have ever traveled abroad, it is likely that you have made a currency transaction. For example, if you are traveling from the US. USA To most European countries and you want to have cash instead of just credit cards, you would have to exchange your dollars for euros, the currency used in the EU. This is basically a currency transaction.