This is how I understand it, I hope someone else can verify or you can test this when the market opens tomorrow. The spread is the difference between the bid and the ask. When you buy, you buy at the bid. When you sell, you sell at the ask. So, your target of 4 pips actually matters by your definition of entry. If you say "at the time you enter" then (assuming you are long) then your long position will begin at the bid. To make 4 pips, you need the ask price to rise 4 pips above that. If the spread is always 2 pips, then you need a 6 pips Bid: 1.0001 (Long entry) average: 1.0000 Ask: 0.9999 if average price moves up 4 pips then Bid: 1.0005 average: 1.0004 Ask: 1.0003 If you close the position here, you sell at the ask price. Price moving up 6 pips Bid: 1.0007 average: 1.0006 Ask: 1.0005 (sell) Again, you sell at the ask, so if you put in a 2 pip stop at the average price of 1.0000, that stop will be taken out if average price moves down 1 pip. So if you wanted to protect your position based on average price, you would place your stop 3 pips below