A pip (percentage in point) is the smallest standard price movement in a Forex currency pair.

For most currency pairs, 1 pip = 0.0001.

📊 Example

If EUR/USD moves from:

1.1000 → 1.1001

That movement equals 1 pip.

If it moves from:

1.1000 → 1.1010

That equals 10 pips.

💲 How is Pip Value Calculated?

The pip value determines how much money you gain or lose for each pip movement.

Pip Value = (One Pip ÷ Exchange Rate) × Trade Size

• One Pip = 0.0001 (for most currency pairs)

• Exchange Rate = Current market price

• Trade Size = Position size (e.g., lot size)

📌 Important Notes

• For most major currency pairs, a pip is the 4th decimal place (0.0001).

• For JPY pairs (e.g., USD/JPY), a pip is typically the 2nd decimal place (0.01).

• Some platforms display an extra decimal (called a pipette), which represents one-tenth of a pip.

  
  

⚠️ This content is provided for informational purposes only and does not constitute investment advice. Trading involves risk.