Bid Price

What is the bid price?

Every quote for a currency pair actually shows two prices: a bid and an ask. The bid price is the price at which your broker (acting as the buyer) is willing to buy the base currency from you. In practical terms, it’s the price you get filled at when you sell, or go short, on a pair.

For example, if EUR/USD is quoted as 1.0850 / 1.0852, the bid price is 1.0850. If you place a sell order right now, your position opens at 1.0850.

Bid vs. ask: reading a two-sided quote

The bid is always the lower of the two prices, and the ask price is always the higher one. The gap between them is the spread — the broker’s built-in cost for facilitating the trade. Using the example above, the spread would be 1.0852 − 1.0850 = 0.0002, or 2 pips.

Worked example

Suppose EUR/USD is quoted at a bid of 1.0850 and an ask of 1.0852. You decide to sell 1 standard lot, opening your short position at the bid price, 1.0850. If the price later falls to 1.0800 and you close the trade by buying back at the new ask price, you’ve captured a 50-pip move, worth roughly $500 on a standard lot (before any commission).

Why it matters to a trader

Every sell order executes at the bid, so it’s the number to watch when planning a short entry or exit level, setting a stop-loss, or estimating slippage. Because the bid and ask move together but are never identical, the bid price alone also tells you nothing about trading cost — you always need to compare it against the ask to see the live spread a broker is offering.

Quick recap

• The bid price is what you receive when selling a currency pair.
• It’s always lower than the ask price; the difference is the spread.
• Bid and ask together define the true two-sided cost of entering or exiting a trade.