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What is a pip (percentage in point) and how is it calculated?

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G
@godswillfx - 1 month ago - Forex Education

A pip (Percentage in Point) is the smallest standard price move in a Forex currency pair.

Simple Explanation:

- For most pairs (like EUR/USD, GBP/USD): 1 pip = 0.0001 (the 4th decimal place).

- For JPY pairs (like USD/JPY): 1 pip = 0.01 (the 2nd decimal place).

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G
@godswillfx - 1 month ago
How to Calculate Pip Movement:

If the price moves from 1.2345 to 1.2358

- Difference = 1.2358 - 1.2345 = 0.0013

- That's 13 pips

Formula:

Pips = (Final Price - Initial Price) ÷ Pip Size

- Pip size is 0.0001 for non-JPY pairs.

- Pip size is 0.01 for JPY pairs.

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G
@godswillfx - 1 month ago

Quick Examples:

- EUR/USD: 1.0920 → 1.0935 = 15 pips

- USD/JPY: 152.30 → 152.75 = 45 pips

That’s it. Pips measure how much the price moved. Pip value (how much money that move is worth) depends on your lot size and account currency, but that’s a separate topic.

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