When trading Forex you'll see two variables - the Bid and the Ask price. The Spread is the difference between these two.

Put simply:

The “bid” is the price at which you can SELL a base currency.

The “ask” is the price at which you can BUY a base currency.

In the below example, you'll notice that the bid is 1.1051 and the Ask is 1.1053 - the difference between these two is calculated in pips. In this case, it's 2 pips called the 'spread'.

Here is how the bid and ask differ:

🔴 Sell Order - you will open at the Bid price and close at the Ask Price.
🟢 Buy Order - you will open at the Ask price and Close at the Bid Price.

Did this answer your question?