What is the Spread?

by Jun 29, 2020Trading Guides

What is the Spread?

The spread is the differences between two prices. In this case, it’s the difference between the buy (bid) and the sell (ask) price. In forex exchange, the spread is likely to be the commission charged by the broker/ or the liquidity provider for providing filing the buy/sell order.

The spread in forex is measured in “pips”, which is the smallest unit of the price movement of the currency pair. One pip is equal to 0.0001. Therefore, a 2 pip spread between the EUR/USD would be 1.1050 / 1.052

 

 

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Technical analysis is a type of analysis derived purely from charts and the price movement of the security. The basis of technical analysis is that past price movement is a good indicator for future price movement. Technical analysis uses statistical trends such as trading volume and historical support / resistance levels to gauge the movement of the price in the future. This in contrast to fundamental analysis, which involves looking at a security from a financial and economic point of view.

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