The spread - the source figure used by the trader at the position taking

GBP/USD 1.6545/1.6550 Sell Price/Buy Price

If you are going to purchase the base currency (to long the pair) relying on your expectations of its increase, you should perform the purchase at the buy price which always higher than the sell price and you’ll lose the spread difference if you suddenly decide to sell this currency at once. Simply speaking, the rise of the currency price that you’ve bought may cause you the losses.

In case you sell the base currency and would decide to buy back the currency you’ve just sold while the rate didn’t move a point, then the difference you’ll lose will be the spread that is 5 pips in the given example.

The trading platform will inform you of the purchase or sale price at which you have bought or sold the currency pair. So if you have bought the pair, the trade platform will show you both your bought price and the current sell price which can be calculated as the by price subtracting the spread. If you want at least to break even you should wait until the market makes at leas a few pips up. The resume can be that the smaller the spread, the better as you’ll have to wail a little time before the market moves enough pips for you to run a surplus.
Standard Spreads

Our advantages are that we have a direct access to trading that causes the existence of the minimum spreads, which are at least much smaller than any other financial market has and the absence of any fee paid for the brokerage houses out of each transaction.

The standard spread depends on the currency pair traded. In case the pair is traded much then the spread fluctuations are low. To sum up, the majors’ (the currency pairs traded most heavily) spreads are generally very tight while the crosses’ and exotics’ (the pairs that are traded less) ones are much wider. The standard spread for the Majors makes from 4 to5 pips whereas the spread of Crosses and Exotics reaches from 5 to 20 pips.

The “tighter” spread shows closer sell and buy prices and the “wider” spread corresponds further difference.

The sell price (bid) is constantly smaller than the buy price (ask).

The price for the pair in forex market is usually shown in the following way where the sell price goes the first:

GBP/USD 1.6545/1.6550 Sell Price/Buy Price

The buy price is sometimes written with only two decimal digits left in the following way:

GBP/USD 1.6545/50

Here the spread is 5 pips. The buy price shows the amount of the secondary currency to be given in order to buy one item of the base one. The sell price shows the amount of the secondary price that you’ll get in order you sell one unit of the base one.