What is a Spread?

When trading Forex, you will see two prices: Bid and Ask. The difference between these two prices is known as the Spread.

• Bid Price: The price at which you can sell the base currency.
• Ask Price: The price at which you can buy the base currency.

Example:
If the Bid price is 1.1051 and the Ask price is 1.1053, the difference is 2 pips, which represents the spread.

Order Execution:

• Sell Order: Opens at the Bid price and closes at the Ask price.
• Buy Order: Opens at the Ask price and closes at the Bid price.

Understanding Bid, Ask, and Spread helps traders better understand trading costs and order execution.