Bid and Ask prices in Metatrader
Posted by - NA - on 09 April 2010 09:20 PM
All Forex quotes have two prices, the BID and the ASK price. |
The Bid is the price at which you (as the trader) will open a sell.
The Ask is the price at which you will open a buy.
The difference between the bid and the ask price is known as the spread.
MT4 charts are Bid charts
The current price shown on an MT4 chart is the bid price. When looking at a price bar or candle, you must add the spread to the high bid price to know what the high ask price would have been, or add the spread to the low bid price to know what the low ask would have been.
If you are in a sell (in at the Bid out at the Ask), you would not see the candle reach your stop loss if you are taken out of the trade. For example with a stop loss of 1.45800 on the EURUSD once the chart reached 1.45780 (2 pip spread) you would be taken out of the trade at 1.45800. Your take profit would not trigger until the ask price hits. For example with a take profit of 1.45400 on the EURUSD once the chart reached 1.45380 (2 pip spread) you would be taken out of the trade at 1.45400. These examples are based on our spread shown under normal market conditions. Our spreads are not fixed and will fluctuate with news or other high / low volume conditions.
If you are in a buy (in at the Ask and out at the Bid), you will see the bid price on the chart. You can turn on the Ask price on the chart by right clicking on the chart, selectinh the "Properties" option from the menu and then check "Show Ask Line" option in the Common tab on the Window that will open.