hello all,

i want to know how to calculate my tp 200 pips in a situation whereby my price gbpjpy is 135.62, how do i calculate tp200 , and sl 100

Hello,

Well: for pairs quoted with two decimal places one pip is a 0.01 movement in price and for pairs quoted with four decimal places one pip is a 0.0001 movement.

So in your case: you’d add 2.00 and 135.62 to get your TP value and you’d subtract 1.00 from 135.62 to get your stop loss.

One thing: if you’re working off of a chart that is only showing you the sell/bid price be sure to add the spread to your tp level (assuming it’s a long trade i.e. it doesn’t apply to a short trade) otherwise your TP level will be 200 pips MINUS whatever the spread is using your example!!! Not a big deal if you’re trading pairs with very small spreads i.e. it’ll ‘cost’ you a pip or a few in profit if you don’t do this but if you’re trading ‘exotics’ where the spreads can be upward of 100 pips etc. then it makes a big difference.

One thing to be aware of though: it’s become ‘the fashion’ for brokers to quote in ‘fractional pips’. In other words (and using GBP/JPY as an example): the price of GBP/JPY may be quoted as 135.624. The last ‘4’ is a ‘fraction of a pip’ or ‘pipette’ and, at least as far as I’m concerned, should be ignored. In my opinion: the only reason for this ‘fractional pip pricing’ is simply to get the trader to place stops ‘just that little bit nearer’ than they normally would so that the stop order can get ‘hunted’. I’ve never been able to find a reasonable explanation for this latest ‘fad’ (and if anybody DOES INDEED have a good explanation for ‘fractional pip pricing’ I for one would be keen to hear it). When the price of EUR/USD is quoted ANYWHERE else EXCEPT at a broker it’s quoted with four decimal places e.g. 1.4500 and NOT as 1.45005!!!

As a matter of fact: I see that even the DOW is being quoted with two decimals nowadays (which obviously I ignore because the Dow moves in ONE POINT increments not ‘fractions of points’)!!!

Regards,

Dale.

All the yen pairs are unique in two ways: (1) JPY is always the cross-currency — no exceptions to this rule, and (2) a pip is represented by the second decimal place (as opposed to the fourth decimal place for all other cross-currencies).

Regarding your question, if you look at your entry price of 135.62, the last digit signifies 2 pips; the last 2 digits taken together signify 62 pips; the last three digits taken together signify 562 pips; etc.

Now, as for adding or subtracting pips to get your SL and TP prices, you didn’t say whether you are going LONG (buying) or going SHORT (selling), so I’ll give you both cases.

Let’s say you want to go LONG (buy) at 135.62 with a 100 pip SL and a 200 pip TP. You would subtract 100 pips to get your SL price, and you would add 200 pips to get your TP price, like this:

LONG @ 135.62 - 100 = 134.62 (stop-loss price)

LONG @ 135.62 + 200 = 137.62 (take-profit price)

If you want to go SHORT (sell) at 135.62 with 100 pip SL and a 200 pip TP, you would ADD 100 pips to get your SL price, and SUBTRACT 200 pips to get your TP price:

SHORT @ 135.62 + 100 = 136.62 (stop-loss price)

SHORT @ 135.62 - 200 = 133.62 (take-profit price)

Thanks, dale for you well explainatory

Dale - aren’t brokers adopting pipettes these days because spreads are getting decimalised (and hence more competitive). I’ve seen the GBP/USD spread at 0.9 pips, 1.6, instead of at 1 or 2 … whereas a few years ago we were always looking at full integer spreads (eg 2)??