The difference between the bid price and the ask price of a currency pair. It is one of the foundational building blocks of forex market structure, and misunderstanding it can lead to confusion when reading quotes or calculating trade size.
The difference between the bid price and the ask price of a currency pair. It is one of the foundational building blocks of forex market structure, and misunderstanding it can lead to confusion when reading quotes or calculating trade size.
It represents the cost of entering a trade and a key source of broker revenue. New traders benefit from internalizing this early, since it underpins much of the terminology and reasoning used throughout the rest of their trading education.
Tighter spreads during major sessions, wider spreads during low liquidity or news events. Most traders come across this while reviewing charts, monitoring news feeds, or checking their account dashboard, and being able to spot it quickly is a useful practical skill.
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