Forex trading is an exciting and profitable venture that has attracted a lot of people to join in. However, as a beginner, it can be quite overwhelming and confusing, especially when it comes to understanding the terminologies and tools used in the industry. One of the most important things to understand is how to count pips in forex using crosshair in MT4.
What are pips in Forex?
Pips, short for “percentage in point,” is a unit of measurement used to indicate the change in the value of a currency pair. The value of a pip is determined by the size of the trade and the exchange rate of the currency pair. In most cases, a pip is equivalent to 0.0001 or 0.01 percent of the currency pair’s value. For example, if the EUR/USD currency pair moves from 1.1200 to 1.1201, it would have moved by one pip.
What is crosshair in MT4?
MT4, short for MetaTrader 4, is a popular trading platform used by most forex traders. It is a user-friendly platform that offers a wide range of tools and features to aid traders in their trading activities. One of these features is the crosshair tool. The crosshair tool is a feature that allows traders to measure the distance between two points on the chart. It is mostly used to determine the entry and exit points for trades.
How to count pips in Forex using crosshair in MT4?
Counting pips in forex using crosshair in MT4 is a simple process that involves the following steps:
Step 1: Open the MT4 trading platform and select the currency pair you want to trade.
Step 2: Click on the “Crosshair” tool located on the toolbar or press the “Ctrl+F” key on your keyboard.
Step 3: Click and drag the crosshair tool from the starting point to the ending point on the chart. The starting point should be the point where you want to measure the pip value, while the ending point should be the point where you want to end the measurement.
Step 4: Once you have dragged the crosshair tool to the desired points, the measurement will be displayed on the chart. The measurement will be displayed in pips, and you can use it to determine the pip value of the currency pair.
For example, if the crosshair tool measurement on the EUR/USD currency pair shows a value of 50 pips, it means that the currency pair has moved by 50 pips. If the size of your trade is 1 lot, then the value of each pip would be $10. Therefore, the total value of the movement would be $500 (50 pips x $10 per pip).
Conclusion
Counting pips in forex using crosshair in MT4 is an essential skill that every forex trader should master. It enables traders to determine the pip value of a currency pair, which is crucial in calculating profits and losses. The crosshair tool is a simple yet powerful feature that makes the process of counting pips easy and efficient. With this knowledge, traders can make informed trading decisions and maximize their profits in the forex market.
