PIPS are killing me

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sorry guys for this basic question , but i have been searching and reading a lot to find a very simple answer to this but i dont know if my mind is blocked or i cant get it or what since i am new at trading .

ok, 

in gold for example

price moves from 1800.21$ to 1802.21$

lot of people refer to this as 20 pips even an EA i used refer to this as 20pips

however many code and formulas  refer to it as 200pips.

and code that i read here assume the points = pips in as gold is a even 2 digit . so its should be 200pips ? I don't really get it 

how can i calculate this the correct way for gold and for other currencies ?

i will apricate  a formula . 

i

 

1 pip=10 points

1 point=1/10th of pip

In your example these are 200 points=20 pips.
 

For Gold (XAUUSD) a change in price quote of 0.01 (0.010 if there are 3 digits instead of 2), is a change of 1 pip.

  • If the XAUUSD price is displayed as ###.## (2 digits), then 1 pip = 1 point = 0.01 price change.
  • If the XAUUSD price is displayed as ###.### (3 digits), then 1 pip = 10 point = 0.010 price change.

You should always look at the contract specifications of the symbol, to know the number of digits and/or point size to be able to know this.

Generally when prices on currency pairs (and the like) are shown with 2 or 4 digits, then 1 pip = 1 point, and when they are shown as 3 or 5 digits, then it is 1 pip = 10 points.

So a change in price of XAUUSD from 1800.21$ to 1802.21, means there was a change in 200 pips.

Please note, that there is also another unit called "Points" which refers to the change in quote on the left hand side of the decimal point (hence its name). This unit is used for stocks and other symbols.

The unit "points" is a unit used on Forex and MetaTrader and is not too widely known in the old school "bull pit" traders and only known to those that trade Forex or use MetaTrader and other similar platforms.

To differentiate between the two, I try to refer to them as "Points" and "points", using uppercase and lowercase "P".

 

thanks Fernando and Eleni

but u see what i mean now ?


Eleni "In your example these are 200 points=20 pips."

Fernando " So a change in price of XAUUSD from 1800.21$ to 1802.21, means there was a change in 200 pips"


2 replies with different answers 

even i sow different EA with different results .!!

 

max s #: thanks Fernando and Eleni but u see what i mean now ?

Eleni "In your example these are 200 points=20 pips."

Fernando " So a change in price of XAUUSD from 1800.21$ to 1802.21, means there was a change in 200 pips"

2 replies with different answers 

even i sow different EA with different results .!!

I believe that Eleni just misread your post (or mistyped). Once she reviews the thread again, she will most probably correct her post. It is in fact 200 pips.

EDIT: Follow-up on the links I provided in my previous post for some clarifications.

 

Here is an example straight from a brokers page of contract specifications ...


As you can see, 1 pip = 0.01

 

Please note also, that given the prices you gave only had 2 digits, then Eleni's answer of 200 points is also correct. Just the part of 20 pips was incorrect.

So to reiterate:

  • So a change in price of XAUUSD from 1800.21 to 1802.21, means there was a change in 200 pips (200 points, due to there being only 2 digits). 
  • But a change in price of XAUUSD from 1800.210 to 1802.210, means that there is still just a change in 200 pips (but it is now 2000 points, due to there being 3 digits).
And in terms of "Points" (stocks), the change was 2 Points (digits on the left hand side of the price quote).
     
    max s #: Fernando " So a change in price of XAUUSD from 1800.21$ to 1802.21, means there was a change in 200 pips"

    The term PIPs only applies to the FX market. It has no meaning elsewhere.

    PIP, Point, or Tick are all different in general.
              What is a TICK? - MQL4 programming forum (2014)

    Unless you manually adjust your SL/TP for each separate symbol, using Point means code breaks on 4 digit brokers, exotics (e.g. USDZAR where spread is over 500 points), and metals. Compute what a PIP is and use it, not points.
              How to manage JPY pairs with parameters? - MQL4 programming forum (2017)
              Slippage defined in index points - Expert Advisors and Automated Trading - MQL5 programming forum (2018)

     
    William Roeder #: The term PIPs only applies to the FX market. It has no meaning elsewhere.

    Originally yes, but it has since been adopted for many other symbols too, like XAUUSD and XAGUSD, for example.

    You just have to run a google search and you will see just how many brokers and other institutions and websites, have adopted the "pip" term for several other symbols.

    Whether that can be considered right or wrong by purists, becomes somewhat irrelevant when the masses decide to use it anyway.

     
    Fernando Carreiro #:

    Originally yes, but it has since been adopted for many other symbols too, like XAUUSD and XAGUSD, for example.

    You just have to run a google search and you will see just how many brokers and other institutions and websites, have adopted the "pip" term for several other symbols.

    Whether that can be considered right or wrong by purists, becomes somewhat irrelevant when the masses decide to use it anyway.

    In your example lot size/contract size is 100oz.

    I saw brokers where contract size for gold is 1 oz. and 10  oz. 

    Plus, there are brokers with two or three decimals for gold. 

    So "how many brokers and other institutions and websites, have adopted the "pip" term for several other symbols" means - each broker can come with it's own definition of "pip" for any instrument beside forex. 

    Forex pip value is the same for all brokers, pip value calculation for other instruments is broker dependent.


    I don't understand why people still use pips even for forex, since most of the brokers switched to odd number of decimals. 

    Using point removes the need to verify pip definitions for your broker and also removes related pip-point conversions from your code.

     
    Fernando Carreiro #:

    Originally yes, but it has since been adopted for many other symbols too, like XAUUSD and XAGUSD, for example.

    You just have to run a google search and you will see just how many brokers and other institutions and websites, have adopted the "pip" term for several other symbols.

    Whether that can be considered right or wrong by purists, becomes somewhat irrelevant when the masses decide to use it anyway.

    I have to disagree with you here.

    People may use the term "Pips" for non-forex instruments but there are no universally accepted values for non-forex "pip size".

    I would consider 1 "pip" in gold to be 0.1, not 0.01. This is because with gold and 100 contract size 1 lot, a 0.1 move equates to $10, whereas  a 0.01 move is $1.

    It would be better if the term "pip" had never existed. Makes it less confusing if everyone used Point.

    Even MT4/5 mixes them up and uses "pips" where it should be Points.

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