1 standard lot = 100 oz → 1 pip = $10 per lot
4180.00 → 4175.00 = $5.00 = 50 pips
Why gold pips are confusing
In forex, a pip is tidy: the fourth decimal on EUR/USD (0.0001), the second on yen pairs. Gold never had a single official definition. It is quoted in dollars per ounce, usually to two decimals (4180.25), and different corners of the market settled on different "pips":
| Who uses it | 1 pip = | $5.00 move is | 1 pip on 1 lot |
|---|---|---|---|
| Most MT4/MT5 brokers, most signal channels | $0.10 | 50 pips | $10 |
| Platforms that call every $0.01 a pip | $0.01 | 500 pips | $1 |
| Casual chat ("gold moved 5 pips") | $1.00 | 5 pips | $100 |
The money never changes. A $5.00 move on one 100-ounce lot is $500 whichever word you use. The danger is mixing conventions: reading a "50-pip stop" as $50 instead of $5, then sizing the trade ten times too small or ten times too big.
Points vs pips on MT4 and MT5
MetaTrader doesn't use pips at all. It uses points, the smallest step the price can move. For a gold symbol with 2 digits (4180.25), one point is $0.01, so:
- 10 points = 1 pip = $0.10
- 100 points = 10 pips = $1.00
- A "500 point" stop in an Expert Advisor is a $5.00, 50-pip stop
Some brokers quote gold to 3 digits (4180.255). Then one point is $0.001 and 100 points make a pip. To check yours, right-click the symbol in Market Watch, choose Specification, and read three fields: Digits, Contract size (usually 100) and Tick size / tick value (on a 100 oz, 2-digit contract: tick size 0.01, tick value $1 per lot).
Counting pips on a trade
Take the price difference and divide by 0.10. That's it.
| Trade | Entry | Exit | Move | Pips |
|---|---|---|---|---|
| Buy, hit target | 4180.00 | 4186.50 | +$6.50 | +65 |
| Buy, hit stop | 4180.00 | 4176.80 | −$3.20 | −32 |
| Sell, hit target | 4211.40 | 4199.40 | +$12.00 | +120 |
| Sell, hit stop | 4211.40 | 4216.40 | −$5.00 | −50 |
What a pip is worth
Pip value depends only on how much gold you hold: lots × 100 oz × $0.10.
- 0.01 lot (1 oz): $0.10 per pip
- 0.10 lot (10 oz): $1 per pip
- 1.00 lot (100 oz): $10 per pip
Unlike most forex pairs, gold's pip value in dollars doesn't change with the price, because the quote currency is already USD. It only changes for you if your account is in pounds or euros. Every lot size is in the gold pip value table.
Reading gold signals in pips
A typical signal reads something like "BUY XAUUSD 4180, SL 4175, TP1 4185, TP2 4190". In pips that's a 50-pip stop with 50- and 100-pip targets. Some channels write the stop as "SL 50 pips" instead of a price; it's the same trade.
If a signal's numbers look odd (a 5-pip stop on gold is almost always a typo for 50, or for $5), convert it back to price and check it against the chart before you size anything. Then put the stop into the lot size calculator as pips, a dollar move or the two prices, whichever the signal gave you.
Spread in pips
The spread is the gap between bid and ask, and on gold it's usually quoted in pips too. At mainstream brokers it's often in the 2–4 pip range in liquid hours, and wider around the daily break (17:00 New York time) and big news. A buy starts the spread in the red, so leave room for it when placing tight stops. When the market is quiet, check the session times.