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Ask And Bid Price

Level Beginner [2017-11-05 09:41:43] - by hillzx
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In the process of buying and selling foreign currency transactions, we are faced with 3 basic components :

  1. Selling Price (BID)
  2. Buying Price (ASK)
  3. Difference (Spread)

 

Selling Price (BID) is the price we get if we want to sell the currency we have to brokers, the price will be much cheaper because of course brokers want to profit from the difference.

Buying Price (ASK) is the price that we get if you want to buy currency from brokers, the price will become more expensive because again brokers want to profit from the difference.

Spread (Spread) is the amount of price difference requested by brokers on purchase transactions. The spread is never equal between one currency and another. Usually the best-selling currency has a lower and more competitive pricing spread, while the opposite of a less-favored currency will have a larger spread.

We take another example if we want to exchange currency EURO to USD (see picture) we get the selling price at 1.1110 and purchase price at 1.1114, it means there is difference of 4 pips as profit for broker / broker.

Bid-ask-and-spread-example



Selling price line / ASK can be seen on Market Symbol Tab on Metatrader application:

askbidlagi

But the ASK line by default is not visible on the screen, here's how to get the ASK price line, right-click the chart select Properties-> Common-> Check Show Ask Line:

showask

askbid 2

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