Pricing & Time Zone

Bid/Offer Spread

All quotes you will find on the Forex market are twoway,
meaning there is a bid and offer. With the offer
always being higher than the bid.

The bid is the price the dealer is willing to buy the base currency.
As a trader this is the price you will sell to. (We sell to the bid)
The offer is the price the dealer is willing sell the base currency.

As a trader this is the price you will buy from. (We buy the offer)
The difference between the bid and offer is called the spread. As a
trader the smaller the spread the better, so be sure shop around, as
different brokers will have different spreads for different currency
pairs.

This is what a typical quote window will look like.


USD/ CAD
Bid Offer
1.0022 1.0025
Sell Buy


If we wanted to go long, using this quote as an example, we would
click the buy button at 1.0025. And if we wanted to short or sell we
would click the sell button at 1.0022.
- When buying we use the offer price.
- When selling we use the bid price.


Forex Market Hours

The Forex market is unique from stocks or futures as it
is open 24 hours a day. Regardless of where you live in
the world the market will be open and you will be able
to trade. Below is a chart showing key times when
markets around the world are active.

Time Zone EST GMT

Tokyo Market Open 07:00 PM 00:00
Tokyo Market Close 04:00 AM 09:00
London Market Open 03:00 AM 08:00
London Market Close 12:00 PM 17:00
New York Open 08:00 AM 13:00
New York Close 05:00 PM 22:00


Lot Size and Pip Calculation

The Forex market is traded in lots, with the benchmark
lot size being $100,000. There are also mini lots of
$10,000.

Each currency will have a different pip value based on the standard
$100,000 lot size. And as the price moves so will the pip value of
the pair you are trading.

Below is an example.

USD/CAD exchange rate of 1.0022
(.0001/1.0022) X $100,000 = $10.02/pip
USD/CAD exchange rate of 1.0652
(.0001/1.0652) X $100,000 = $10.65/pip

As you can see as the market fluctuates so to does the
value of a pip.