CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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ThinkMarkets > Support > FAQs > Trading FAQs > What is bid and ask in forex?
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What is bid and ask in forex?

Two of the most basic terms in the forex world are the 'bid and ask. 
 
' The 'bid' is what buyers are willing to step in and pay for a currency pair, while the 'ask' is what sellers are asking for that same pair. If you wish to buy the market, you need to pay the 'ask', while if you wish to sell the market, you need to offer the 'bid' price. 
 
The difference is sometimes fixed, but it can also be variable, depending on where the buyers and sellers are actually sitting in the marketplace. 
 
During liquid times such as major news announcements, you may find less buyers and sellers in the market, as they step away from the volatility. This can make the markets very jumpy and can make the spread (the distance between the bid and ask) widen. This is especially true during certain announcements such as the US Non-Farm Payrolls announcement, GDP announcements, and interest-rate decisions. 
 
When spreads widen out, it’s generally a good idea to avoid placing new positions. That being said, typically these illiquid times are very short-lived as the forex market is the most heavily traded market in the world. 
 
For example, even in a scenario where a jobs report in the US has just been released, generally the spreads go back to normal ranges within a few moments. However, during financial crises, there can be longer periods of time where the spread winds out and you can see the bid and ask changed dramatically. 
 
Because of its low spread, quite often the EUR/USD pair is a favourite of short-term traders because the difference between the bid and the ask is less than one pip. 

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Risk warning for retail traders: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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