Ask and Bid

What do Ask and Bid mean in Forex?
To start trading in the Forex, traders must be familiar with the currency pair they are purchasing or selling as well as its price which can be seen through the Ask and Bid. The ask price is the usually higher amount that a trader can buy the first currency listed in a pair, while the bid price is the amount a trader can get for selling that currency. Selling a currency pair also means that a trader is buying the second currency listed in that pair.

To make this clearer, let us use the currency pair of EUR/USD with a value of 1.3652/1.3655

In that example, the bid price is 1.3652 while the ask price is 1.3655. Using that information we know that if we want to buy euros, we will have to pay 1.3655 US dollars. If we want to sell euros, we will get 1.3652 US dollars. The difference between the bid and ask prices is called the spread and it serves as the commission or trading fee for a trader’s broker. Spreads are usually extremely tight or have a small difference because brokers compete with each other to attract investors like you.