In this video, you'll learn what a pip is in forex trading and how it works
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So, moving on in this section, you will learn number one. What is a bit number two? What is a paypal and number three? How to read a currency pair code? So, let's get started so first and foremost right. What is a pip? A pip stands for percentage in point in essence, right. What it's trying to do is to measure it's a measure right of a change in value in the currency pair.

Don't worry we'll get to that later, so a pip right, remember it's the fourth decimal place in the currency pair code. So let me explain right. Let me give an example. So, let's see, let's say right: euro against the us dollar moves from 1.3500 to 1.3505.

Now, let me ask you: where is where is the number to look at when you want to find out? What is the value change so remember, pip is the fourth decimal place, so this is basically the fourth number after this dot. So one two three four you're looking at this number here so you're, comparing the difference between this number here and this number here: okay, so quiz time, how many pips difference is this? So, let's find out an answer is quite straightforward. This is actually an increase right of five pips from 1.3500 to 1.3505. It's a difference of five pips, so you can see right the last digit, the fourth decimal placing digit right.

It has moved from zero to five. That's an increase of five pips. Let's do another example. Let's say this time around the euro against the dollar moves from one point: three: four: zero: zero to 1.3350.

Now, how many pips is this right? Let's uh give you five seconds to figure this out. One two: three: four: five: okay, so the answer is a decrease of 50 pips. So in essence, right this uh euro against the dollar. It has dropped 50 pips from 1.3400 to 1.3350, so quick tip that i have for you is that if you have difficulty you know, you know using your fingers counting and stuff like that.

You just take a calculator. Take this last four digit minus this last four digit and you'll get 50.. Okay, that's another way to go about it. So moving on one thing to share is that the yen pairs they are special.

They are not like. You know the other currency pairs where the pip right is at the fourth decimal place for yen pairs. Like you know, the dollar against the japanese year and the pound against the japanese yen, the pip value is the second decimal place, so bear this in mind. Only for yen pairs, the pip value or the the pick check the the pick when you look at the currency code right it's at the second decimal place.

So let me give you an example. Let's say the dollar against the japanese yen moves from 100.102.15. How many pips is that, how many uh, how much pips did this pair move again very simple, you can just remember second decimal place is where you look at for the pip for en pair, so you just take uh 15 minus 10, and the answer is an Increase of five pips next one another example: let's say the dollar against the japanese yen moves from 100.25 to 100.1. How many pips difference is this again very simple: take the uh 1 0, which is 10 minus 25, and you get a decrease of 15 pips, and this is in essence right how you you are measure right, how many pips a currency pair has moved and to Take things a step further because the forex got you know like to make your life a bit more difficult.
There's another thing called a pipette and in essence, right, a pipe is simply known as fractional pips. They are 110. The value of a pit confusing. Don't worry an example usually solves your pain.

So, and one thing to bear in mind is that a pipette is the fifth decimal place for most currency pairs for the yen pairs. It's the third decimal place, so an example would ease your pain. Let's say, euro against the dollar moves from one three: five: zero: zero, five, which this one here is the pipette to 1.3505 seven. This seven here is the pipette value.

So how many pips movement is this? So again you just do the simple math. You will realize that this is an increase of 5.2 pips makes sense. I know it makes sense right. So let's do a quick recap number one.

A pip is a measure of a change in value right in the currency pair. It's the fourth decimal place for most currency pairs, except the yen, which is the second decimal place. So if you want to be a little bit more, you know particular there's something called the p-pad, which is in essence, 110 of a pip. You.


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16 thoughts on “What is a pip in forex trading? (video 3 of 13)”
  1. Avataaar/Circle Created with python_avatars Tim Maemura says:

    Rayner never has time for BS

  2. Avataaar/Circle Created with python_avatars Belajar Bisnis Digital says:

    VERY DETAIL AND SO EASY TO UNDERSTAND…THANK BRO.

  3. Avataaar/Circle Created with python_avatars jaybomb.626 says:

    My Trade Plan.
    (1) – Subscribe Rayner Teo
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  4. Avataaar/Circle Created with python_avatars KARAN TIWARI says:

    Thanks โ˜บ๏ธ great work ๐Ÿ™๐Ÿ‡ฎ๐Ÿ‡ณโค๏ธ

  5. Avataaar/Circle Created with python_avatars Trading Meme Studio says:

    Thank you for sharing your knowledge

  6. Avataaar/Circle Created with python_avatars Samarth Bhilavadikar says:

    Love you brother from India God Bless you

    You are killing always โ™ฅ๏ธโ™ฅ๏ธโ™ฅ๏ธโ™ฅ๏ธโ™ฅ๏ธโ™ฅ๏ธ๐Ÿ˜˜

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  7. Avataaar/Circle Created with python_avatars Trading Angel says:

    Great video ๐Ÿ™‚ love that you are going back over the basics

  8. Avataaar/Circle Created with python_avatars Chakradhar Chakka says:

    Nice explanation

  9. Avataaar/Circle Created with python_avatars maphyus says:

    Finally ๐Ÿ˜Ž๐Ÿ˜Ž

  10. Avataaar/Circle Created with python_avatars Dolaand Trump says:

    Recording of today's webinar?

  11. Avataaar/Circle Created with python_avatars GIGUNG says:

    eur/usd Increase of 52 pipette ๐Ÿ˜

  12. Avataaar/Circle Created with python_avatars King Stretch says:

    Wat is pip used for

  13. Avataaar/Circle Created with python_avatars Steinar Jรณnsson says:

    This video is gold!
    I don't do forex trading but I've wondered for some time what pips are and the dictionary was not exactly helpful, but now I know.
    Thank you Rayner!

  14. Avataaar/Circle Created with python_avatars Tony 369 says:

    ๐Ÿ™๐Ÿ˜‡๐Ÿ˜‡๐Ÿ˜‡๐Ÿ˜‡

  15. Avataaar/Circle Created with python_avatars ras zion says:

    Awesome……………. Always needed to understand pips ………… ๐Ÿ”ฅ๐Ÿ”ฅ๐Ÿ”ฅ๐Ÿ”ฅ๐Ÿ”ฅ๐Ÿ’ฅ๐Ÿ’ฅ

  16. Avataaar/Circle Created with python_avatars Theresia Mpingana says:

    What are the key point of the market sir

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