How Do You Read Pips for Standard Account?
A pips is the smallest price movement in the exchange rate of a forex pair, the pip is used to calculate forex profits and losses when trading the online forex market.
How to Interpret/Analyze Forex Pips When Standard Lots
In a forex exchange rate quote the pip is the fourth decimal in the price quote - e.g. a EUR/USD quote of 1.3000 if it moves to 1.3001 this is a movement of 1 pip.
Currency pair movement in fx is calculated using pips, when trading one Standard lot the pip movement is equivalent to $10 like displayed & shown on the examples below:
How to Read Pip value in a Standard Trading Account
To calculate the profit or loss for a Standard trading account one will count number of pips that a forex pair has moved & multiply this number of pips with $10 dollars. $10 is the pip value when trading forex Standard lots.
1 pip is the minimum currency pair movement used when trading forex currencies.1 pip movement when trading Standard lots is equal to $10 dollars (100,000 currency units * 0.0001 = $10 dollars)
How to Calculate Forex Profit and Loss in a Standard Account
Example 1: if EURUSD moves from 1.3000 to 1.3001 this is equal to 1 pip - one pip is the 4th decimal place in the fx quote.
The profit or loss will be:
1.3001 - 1.3000 = 1 pip
1 pip* $10 per 1 pip = $10
Hence, 1 pip movement for Standard lot is equal to $10 dollars
If the trade transaction moves in direction of the trade transaction, the trader will make and earn a profit of $10 dollars. If the trade transaction moves against the direction of the trade transaction, the trader will accrue a loss of $10 dollars.
Example 2: for Example if EURUSD moves from 1.3000 to 1.3010 this is equal to 10 pips - 1 pip is the fourth decimal place in the currency quote.
The profit or loss will be:
1.3010 - 1.3000 = 10 pips
10 pip* $10 per pip = $100Therefore, 10 pips move for Standard lot is equivalent to $100 dollars
If the trade transaction moves in direction of the trade transaction, the trader will make and earn a profit of $100 dollars. If the trade transaction moves against the direction of the trade transaction, the trader will make a loss of $100.
Example 3: for Example if EURUSD moves from 1.3000 to 1.3025 this is equivalent to 25 pips - 1 pip is the fourth decimal place in the currency quote.
The profit or loss will be:
1.3025 - 1.3000 = 25 pips
25 pip* $10 per pip = $250
Therefore, 25 pips move for Standard lot is equal to $250 dollars
If the trade transaction moves in direction of the trade transaction, the trader will make a profit of $250 dollars. If the trade transaction moves against the direction of the trade transaction, the trader will make a loss of $250 dollars.
How to calculate Standard Account Pip Size and Profit & Loss in a Standard Trading Account.
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