What it is — Bid and Ask
Every currency quote arrives as two prices. The bid is the best price you can currently sell at; the ask (or offer) is the best price you can currently buy at. The bid is always the lower number, and the gap between them is the spread — the market maker's cut.
The mnemonic traders use: you buy high (ask), sell low (bid). It sounds backwards because it's quoted from the market's perspective, not yours.
Why it matters — Bid and Ask
- It explains instant negative P/L on every fresh trade — that's the spread being collected, not a broken platform.
- Liquidity awareness: tight, stable bid-ask gaps signal a healthy market; wild gaps signal danger (news, thin sessions).
- Cost comparison: brokers compete on this gap — compare total costs in our spread guide.
The two prices on your screen
Every quote is two prices. EURUSD shows 1.12294 / 1.12304: the bid (1.12294) is what you can sell at right now; the ask (1.12304) is what you can buy at right now. You always buy at the ask and sell at the bid, and the 1-pip gap between them — the spread — is the market’s cut, paid the instant you transact: buy one standard lot and immediately change your mind, and you sell back at the bid, having paid $10 for the round trip. The ask-bid pair is not a quirk; it is how every market quotes, and its width is the cheapest live measure of how much standing in that crowd costs.
Which price does my chart show — and which one fills me?
Charts almost always plot the bid, which explains the classic beginner’s shock: a long position opened at the ask starts “underwater” by exactly the spread even though the chart line hasn’t moved. The mechanics by side: long positions close at the bid (so a long’s stop-loss triggers when the bid reaches it), and short positions close at the ask (their stop triggers on the ask). This is also why stops in thin hours get hit “early” on charts — the line you watch and the price that fills you are not the same line (the slippage page covers the consequences). Budget the spread as a fixed cost per round trip — the Pip Value Calculator turns it into dollars for your size — and no fill will ever surprise you twice.
Frequently asked questions — Bid and Ask
Which price do I trade at?
You buy at the ask and sell at the bid. Charts usually plot the bid by default — which is why buy entries look a hair late and sell entries look instant.
Why did my trade open already at a loss?
You crossed the spread: you bought at the ask, and its instant value is the bid you could sell back at. That gap is the market's transaction cost, visible on every quote, priced into every plan that survives.
Do I buy at the bid or the ask?
Buy at the ask, sell at the bid — always, in every market. Charts usually draw the bid line, which is why longs look slightly underwater at entry and why long stops fire on bid touches.
Why is the ask always higher?
It's how the dealer earns: matching counterparties at two slightly different prices keeps the house paid without a separate fee.