XEM/USD trading pair

What Is a XEM/USD Trading Pair?

When you dive into the world of Option trading with cryptocurrencies, one term you will likely come across is the 'XEM/USD trading pair'. This term refers to the trade between the cryptocurrency NEM (XEM) and the United States Dollar (USD). In this pair, XEM is known as the 'base currency', while USD is the 'quote currency'. Essentially, this means you can trade your XEM for USD, or vice versa.

Why Is the XEM/USD Trading Pair Important?

The XEM/USD trading pair has significance because it gives a direct value of XEM in terms of USD. Instead of converting XEM into Bitcoin (BTC), Ether (ETH), or any other cryptocurrency before trading it for USD, the XEM/USD trading pair simplifies the process. This pair offers direct trading and price-tracking benefits making it easier for traders to comprehend and usess.

Understanding Pricing in XEM/USD Trading Pair

As we dive further into the world of Option trading with cryptocurrencies, understanding the pricing dynamics in the XEM/USD trading pair becomes significant. The price stated in a XEM/USD pair lets you know how much USD it would take to buy one XEM. For example, if the XEM/USD trading pair is set at 0.10, it would consequently mean you need 10 cents in USD to acquire one XEM. As such, understanding this pricing can make your trading process more straightforward and successful.

Trading XEM/USD in Options

In Option trading with cryptocurrencies, a trader can speculate the price movement of the XEM/USD trading pair. If they believe the price of XEM will rise against USD, they can buy a call option. If they think it will fall, they can buy a put option. These options give traders a right but not an obligation to buy (call option) or sell (put option) the XEM at an agreed price within a specific period. Therefore, in essence, buying an option can enable a trader to wager on price changes in the XEM/USD trading pair without having to directly purchase or sell the XEM.