How To calculate Lot & pips size in forex trading step traders

Guys, if you do forex trading, then you should know these two basic things: pips size calculation and lot size calculation

If you don’t know them, then you can never make money in forex trading . But today, we are going to learn from basics to advanced: How To calculate Lot & pips size in forex trading

what are the different ways to count pips, and how to calculate lot size. If you have a small account of $1000 or $100, then how much lot you should take.

Forex Trading Guide: How To calculate Lot & pips size in forex trading

You will learn in this blog How To calculate Lot & pips size in forex trading step traders

First of all, guys, we will see How To calculate Lot & pips size in forex Trading . Pips are counted in three ways in forex.

First, it is in USD pairs, no matter whether it is a major USD pair or any other pair then the second mode is our JPY pairs, where pips are counted differently.

And then finally comes our gold, which is the most profitable asset

You will probably trade gold the most, but you might be confused and not know how to actually count pips in gold.

So if you don’t know, here we will learn about all this. First, let’s take the example of Euro USD. Let’s see, we are taking a random number in Euro USD, it is going at 1.0785.

It is running at 785.6 euros in USD or in any USD pairs, after the point there are 5 digits. You need to understand this very carefully, it is very confusing, but I will try to explain it very easily. In 1.07856, there are 5 digits after the point.

If you open any USD pair, you will always see 5 digits after the point. But we will ignore the 5th digit and will focus only on the 4 digits after the point.

We will focus on the 4 digits after the point. In 1.0785, we will not count the last digit.

The reason is, if you are measuring something in kilometers or meters, then in the meter measurement, you can ignore centimeters. For example,

if something is 1 meter and 1 centimeter, the centimeter has no significant value compared to 1 meter, so you can ignore that 1 centimeter, Similarly, here the 5th digit is called a pipit; here it is called pips.

All digits have a fraction part after the 4 digits, which comes under the 5th digit, and that is called a pip it to make it easy, you can ignore it.

Don’t worry about what a pipit is or what the 5th digit is.

Forget about it, just focus on the 4 digits that come after our point. Now the price has changed, it fluctuated from 1.0785 and went to 86.

How much difference is there at 86?

If you look carefully, the difference is just 1 pip. It went up 1 pip from 85 to 86, meaning our point went up by 1.

So what is the difference for us? It’s 1 pip, okay.

Now, besides this, if our price comes to 1.0790, how much difference is there in it?

If we compare 785 to 790, what is the difference? It’s 5 points, meaning 5 pips, So here, the price fluctuated by our 5 pips, our price changed by 5 pips, and here it came to 1.0685.

Now you have to check, 1.0685 compared to 1.0785, how much difference will there be?

Simply, if you find the difference from 1.0785, the difference will be 0.0100, meaning there is a difference of 100 points.

A point here is the last digit, like 8685, we call that one point.

So now how much has come here, is it 686-785, or do we just take 786? Here also 786, 786, and 686, how much is the difference?

It’s 100 points, which means here we directly got a difference of 100 pips. Our change is 100 pips whether the change is high or low is another matter, depending on which one you are selecting.

If you are buying, the buying price will go up, and the selling price will stay down. Simple basic, here we have a difference of 100 pips.

Now after USD, let’s take JPY. In the USD/JPY pair, how much is our USD/JPY running? 140.50. And in this 140 USD/JPY pair, after the point there are 10 digits,

150, and after 5 we got 5 again. Like we ignored 1 digit out of 5 digits and focused on 4, similarly here we will ignore 1 out of 10 digits and focus only

on 2. Out of 505 we will remove the last 5 and focus only on 50. Now what is our price here? 140.50.

Here we will calculate the difference, from 140 how much has it changed, from 50 to 60.

What was the points difference? It’s a 10-point difference. We won’t call it 0.10. 0.10 is there, but this thing is our 10 pips. This difference is of 10 pips

. Similarly, in USD/JPY, ours is 140.500 and the other one is 141.50. See how much the difference is?

It’s straight a one-point difference here, a one-point difference that means if I write it here and add it, our difference is 1.00. A 1.00 difference means 100 pips directly, in USD/JPY.

You can take any JPY pair; if I take a JPY pair here, whether it’s USD/JPY, CAD/JPY, or EUR/JPY, any of these are our JPY pairs So in JPY, 1 movement will give us a 100 pips difference.

Simply put, we got a 100 pips difference.

If we have a 1 pip movement in a JPY pair, now let’s talk about the most important thing—how to count in gold because gold is the most confusing for people.

People don’t understand gold at all, it is the most confusing, but let’s go. Our gold is currently at 3000.

When our gold moved from 3000 to 3001, what was the difference? Our difference is 1 point.

Remember one thing for gold: in gold, 1 point = 10 pips. Within 1 point in gold, we have 10 pips. So, how much was our difference? A difference of 1 point means how many pips of difference?

The difference was 10 pips ,Let me give an example: Our gold moved from 3000 to 3100, what was the difference?

Our difference was 100 points. How many pips are in 100 points?

In 1 point there are 10 pips, so in 100 points, we will have 1000 pips. 1000 pips means if our gold goes from 3000 to 3100, within 100 points, how much difference did we have? 1000 pips.

And let’s take another example: our gold moved from 3000 to 310. What was the difference in points? 10 points.

How many pips will we get in 10 points?

100 pips, simple and crystal clear. You just count the difference in points in gold. Whatever points you get, add a 0, and that will be our pips.

Now our amount has been rounded. If gold doesn’t come in our rounded figure, then how will we do it? Let’s say 3100 points. After 505 points there are 3 digits

you know that gold also has 3 digits after the points, but here too we will ignore the 3rd digit and just focus on 2 digits: 3100.50 and next what, 3101.50. How many points difference is there?

Our 1 point full difference is 1 = 10 pips. Whatever points you are getting in gold, count them in pips, even if you are getting half points.

If you are getting 0.5 points = 5 pips, and if our 1 point is 1 point = 10 pips, then half a point gives us 5 pips, simple.

Now, what is lot size? Until now we have seen pips size, but what is lot size in forex we have 3 types of lots

1.00- standard lot

0.10-microlot

0.01- NANO lot

And the lot size is

is same for everyone, no matter whether you trade in gold or in a USD forex pair or a JPY pair, the lot size always remains the same.

But the most important question is if my account is $100 or $500 or $200, and I have deposited $200 in my account and I trade in gold, how much lot size would I need to take for gold?

If I am trading in EUR/USD, how much lot should I take in EUR/USD?