Foreign exchange trading, also known as FX or forex, is the simultaneous buying of one currency and selling of another. The forex market is not based in a central location or exchange, so it's open 24 hours a day from Sunday night through to Friday night.
Forex is always traded in pairs. When trading forex, you always speculate on whether the price of the base currency will rise or fall against the counter currency. So with GBP/USD if you think GBP (the base currency) will rise against USD, you 'go long' (buy) the currency pair. Alternatively, if you think GBP will fall against USD (or that USD will rise against GBP), you 'go short' (sell) the currency pair.
If you were right (that is if you went long GBP/USD and GBP went up in value against USD), you would make a profit. If the trade went against you, however, you would make a loss, which could exceed your deposits.