Pips and Pip Value
A pip is the smallest increment of a change in price. Profit is measured in pips also. Every currency you trade (except the Japanese Yen) will be quoted with 4 digits after the decimal point such as 1.2945. When the last digit changes by 1, the price has moved a pip.
.0001 to .0002 is a change of 1 pip.
For example, if the GBP/USD price changes from 2.0140 to 2.0141, the price has changed by 1 pip.
If the EUR/USD price changes from 1.4096 to 1.4086, the price has changed by 10 pips.
If the USD/JPY price changes from 114.70 to 114.71, the price has changed by 1 pip.
If the EUR/USD price changes from 1.4096 to 1.4046, the price has changed by 50 pips.
Any currency paired with the Japanese Yen will have 2 digits after the decimal point. It works just the same as any other currency pair.
So, how much money do you make if the price changes by 1 pip in your favor?
This depends on the currency being traded and the amount you are trading.
posted by Forex 1 million is possible @ 5:39 PM
Comments: 0
