What is the bid price in forex?
The bid price refers to the highest price that a buyer is willing to pay for a currency pair. It represents the price at which you can sell the base currency in exchange for the quote currency. The bid price is displayed on the left side of a currency pair quote, along with the ask price.
The difference between the bid and ask price is called the spread, and it represents the transaction cost for executing a trade. Traders typically aim to sell at the bid price or higher to maximize their profits.
Example of the bid price in forex
Let’s say you are trading the EUR/USD pair, and the current bid price is 1.2000. This means that you can sell one Euro for 1.2000 US Dollars.
The bid price is typically displayed on the left side of a currency quote and is always lower than the ask or offer price. The bid price is important because it determines the price at which you can enter a short position in the market