📌 What is a Pip?

A Pip (Percentage in Point) is the standardized unit of measurement used to quantify price movements in Forex. For most 4-decimal currency pairs (e.g., EUR/USD moving from 1.0850 to 1.0851), a 0.0001 movement equals 1 Pip. For JPY pairs, a 0.01 movement equals 1 Pip.

💡 Why Pip Value Matters: Your profit or loss per pip depends directly on your lot size. Knowing the Pip Value before entering a trade is critical for proper Risk Management.

🔬 What is a Pipette (Fractional Pip)?

Modern brokers use 5-decimal pricing (3 decimals for JPY). The 5th decimal digit is called a Pipette. 1 Pip = 10 Pipettes.

📊 Understanding Lot Sizes & Pip Values

Forex trades are measured in standardized units called Lot Sizes:

• Standard Lot: Standard Lot (1.00 = 100,000 units) ➔ 1 Pip = ~$10.00
• Mini Lot: Mini Lot (0.10 = 10,000 units) ➔ 1 Pip = ~$1.00
• Micro Lot: Micro Lot (0.01 = 1,000 units) ➔ 1 Pip = ~$0.10