Let's continue reviewing the basics. What is a pip in forex trading?
Greatly explained, with a clear cut example.pip is basically the unit of measurement of profit or loss when it comes to trading. The profit/loss is first calculated in decimal places (which is the difference between open and close price of the trade.) If we take an example of EURUSD, the open price for a trade be 1.18633 and close price be 1.17990 for a sell order. Here the profit is open - close price i.e. 0.00643. here profit in pips is 64.3 (as 5th decimal place is a fractional pip also called pipettes) thus, considering the value of 1 pip is $10. total profit in this case will be $643.