Welcome, visitor! Yes, the BTCUSD spread... what is that? Why is it so high? How much is a pip in BTCUSD? And a point? The spread in the BTCUSD symbol is a bit special in the sense that 1 pip does not equal to 10 points like in most of foreign exchange currency pairs. In BTCUSD 1 pip (or 1 USD) is equal to 100 pips. Let's remind the explanation of the "Maximum spread (pips)" input parameter in BitDooZER, which should clarify things a little:
Maximum spread (pips): Default value "7.01". Maximum tolerance for the spread, meaning that if the current spread is above this value, the trade won't be placed, and instead BitDooZER will wait until the spread is within the threshold. For that reason we do recommend a broker with good spreads. The pips for BTCUSD are somewhat peculiar. In many places you can see that the value of 1 pip is compared to 1 USD, so in other words a spread of 7 pips would be like saying a spread of 7 USD. Pay attention now, because when it comes to converting into points 1 pip in BTCUSD is not equal to 10 points but 100 points. That's the reason why you might see that your broker has this symbol spread expressed as 500 or 600. That would be like saying 5 pips (500 divided into 100) or 6 pips (600 into 100). To sum this up, the value you put in this parameter in pips should be multiplied by 100 if you want to express it in points, and compare it to your broker spread. The default value of 7.01 pips, therefore, is equivalent to 701 points of spread. Adjust accordingly.
Now, let's see a practical example. Look at the picture below, and observe the Bid, the Ask and how the spread is expressed:
The Bid is 19089.80 (notice only the two digits after the decimal point) and the Ask is 19096.47. If we subtract the Bid from the Ask that leaves us a spread of:
19096.47 - 19089.80 = 6.67
You will see this value sometimes expressed as "US dollars", or in other words, in some places the spread would be considered as 6.67 USD. That's not really important, but note how some brokers like to express this spread not in pips (or USD) but in points, and as we mentioned earlier 1 point in BTCUSD is not 10 points but 100 instead. Therefore when the broker gives you the spread of BTC in points...:
6.67 pips x 100 points/pip = 667 points
Don't get confused. In BitDooZER the spread tolerance is expressed in pips, and the default value is 7.01. That means that in our example, with 6.67 spread, BitDooZER would be allowed to trade. Or expressed in points it will be 701 as default value for BitDooZER and our example was 667 points. Seems complicated, but it's really not. Happy trading!
