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Forex Pips Explained and How to Calculate Pips in Forex
Forex

Forex Pips Explained and How to Calculate Pips in Forex

Muntazeer Mehdi November 30, 2018

Forex pips explained? Probably when you trade in forex online exchange market you must know about what is a pip and a pipet and how to calculate them here we are going to do a little math practice and we are going to explain everything for you and don’t even think about trading until you don’t know about pips and calculating profit and loss here we go with a very informative article about what are pips in Forex trading

What are pips in Forex trading?

The unite of measurement and change in the value of  to currencies  call a “pip”

If AUD/USD goes from 0.7314 to 0.7315 the unit 0.0001 is the value of ONE PIP

A Pip is usually the last decimal place of a  phrase

Almost every currency has 4 decimal places. but some currencies like Japanese Yen go with 2 decimal places.

what are pips in Forex trading?

Like I said before every currency has 4 decimal places but some currencies like Japanese Yen has 2 decimal places here you can see in an example down.

what are pips in Forex trading?

What is pipette?

Usually, brokers give currencies 4 and 2 decimal places but there are brokers who give currencies 5 and 3 decimal places.

The digit after a pip is called pipette for instance if AUD/USD moves from  0.73141 to 0.73142 the unit 0.00001 is the value of ONE PIPPETE

what are pips in Forex trading?

And like that, the Japanese Yen pipette example would be

what are pips in Forex trading?

How to calculate the value of a pip

After understanding pip and pipette now you should understand how to calculate their value.

In the first few examples, we will calculate 4 decimal places currencies.

  • You enter NZD/USD at 1.09892 and exit at 1.16971 how many pips you are earned?

1.09892-1.16971 = 0.07081

0.07081/0.0001 = 708.1 pips

here 708 is the value of pip and point 1 (.1) is the pipette.

  • You enter at 95.343 and exit at 95.445 how many pips you have earned?

95.343-95.445 = 0.102

0.102/0.01 = 10.2 pips

Because it is a 2 digit pip number you divide by 0.01 

  • Entry point at 136.060 exits at 144.549

1.36.060-144.549 = 8.489

8.489/0.01=848.9 pips 

You can calculate pips online as well visit OnlinepipCalculator  to calculate your pips online

Conclusion

Forex pips explained, Hope you have learned what are pips in Forex trading? and how to calculate pips? for more updates about Forex visit our website Techzeer.

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About The Author

Muntazeer Mehdi

Hi, I'm Muntazeer Mehdi! Microsoft Certified IT Professional. SEO Expert & Content Writer I like to write about Computer Network, WordPress, Blogging Tips, SEO, How To, Computer IT Tips, Tech, and Creating Tech Tutorials. Thanks For Visiting Techzeer.com.

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