Trade Forex Trading

How Do I Calculate Number of Pips in Currency Pairs Moves

To accurately calculate the number of pips moved by a currency pair, the trader must reference the movement shown in the fourth decimal place of the quoted price.

The fourth decimal is a pip. Brokers add a fifth decimal called a pipette. Ten pipettes equal one pip.

Example: for 4 decimal Points Quote

If the EUR USD currency pair moves from the 1.4500 level to 1.4501, this specific price change corresponds to:

1.4501-1.4500 = 0.0001 (1 pip)

The Value of = 0.0001 USD

1 contract = $100,000

The Value of 1 pip for 1 contract and lot = 100,000* 0.0001= $10 dollars

1 pip = $10, for Four Decimal Points Format

4-Point Decimal Quotes in MT4 - Calculate Pips in Currency Pairs

4 Points Decimal Currency Quotes Format in the MT4 Software - Pips

Example: for Five Decimal Points Quote in Forex Trading

If EUR USD moves from 1.45000 to 1.45001 then this movement is equivalent to:

1.45001-1.45000 = 0.00001 (1/10 pipette)

Value of = 0.00001 USD

1 contract and lot = $100,000 dollars

Value of 1/10 pipette for 1 contract and lot = 100,000* 0.00001= $1

1/10 pipette = $1, for Five Decimal Points Format

5-Decimal Quotes in MT4 - MT4 Pip Fractions Explained

5 Decimal Point Currency Quotes Format in MT4 Software - Forex Pip Fraction Details

Observe in the MT4 interface how the fifth decimal place is shown in a smaller digit than others. This visual design identifies it as a fraction of a pip for clarity.

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