There are fixed and floating values for a pip depending upon the currency pair. When the USD is on the right side of the pair (EUR/USD, GBP/USD, AUD/USD, and NZD/USD) the pip is value is fixed at $1.00 per 10,000 currency units. This is a fixed pip value. When the USD is on the left side (USD/CHF) or the currency pair is made of two foreign currencies (EUR/JPY), the pip value floats or changes compared to the daily exchange rate fluctuation. An approximate floating pip value of the USD/JPY per 10,000 units of the base currency is $0.85.
Similar Posts
WHAT IS A LOT?
A standard unit of measurement for a FOREX trade. One lot in a standard account is approximately equal to $100,000 currency. Whereas, one lot in a Mini account is approximately equal to $10,000 of currency.
WHEN IS THE FOREX MARKET OPEN FOR TRADING?
In a 24-hour market, Forex trading begins each day in Sydney, and moves around the globe as the business day begins in each financial center, first to Tokyo, then London, and New York. Unlike any other financial market, investors can respond to currency fluctuations caused by economic, social and political events at the time they…
WHAT IS THE FOREIGN EXCHANGE (FOREX) MARKET?
The Foreign Exchange market, also referred to as the spot “FOREX” market, is the largest financial market in the world, with a daily average turnover of approximately $1.5 trillion USD. Foreign Exchange is the simultaneous buying of one currency and selling of another. Most FOREX trading consists of trades between the U.S. dollar and six…
WHEN IS THE BEST TIME TO TRADE THE FOREX MARKET?
In our opinion, generally when a country’s banks and equity markets (stock, commodities, bond, etc.) are open. For instance, trading the Euro may be best from 1 a.m. Eastern Time through 9a.m. Eastern Time.
WHAT IS THE MARGIN REQUIREMENT TO MAKE A TRADE?
The FOREX allows spot currency positions to be leveraged at various amounts depending on the broker – up to 50:1 leverage is common. This means that a 2% margin deposit ($200) allows you to control $10,000 of currency in a 1 Mini lot position in the FOREX market. FOREX trading is conducted on “margin” which…
WHAT IS MARGIN?
The amount of cash deposit required in a clients account in order to open a position or to maintain an open position. Margin is essentially collateral for a position. If the market moves against a customer’s position, the client will be requested to deposit additional funds through a “margin call.”