Performance
Although the Pound has slowly deteriorated in the decades after World War II, the British pound has generally been stronger than the USD.
The British pound's value plummeted during the Great Recession. Before the global recession, the pair traded at all-time highs above 2.0. But when investors rushed to the US dollar, a so-called safe-haven currency, in 2007, the GBPUSD pair plunged below 1.40, losing more than a third of its value.
When Britain decided to exit the European Union in June 2016, the GBPUSD experienced another significant drop. The GBPUSD pair dropped roughly 20% in the month before the Brexit vote and plunged 10% in a single trading session. The Cable recovered all the losses in 2018, but so far, it has never managed to get above the pre-Brexit levels.
Another significant decline occurred in March 2020 when the COVID pandemic crippled the world and governments announced global lockdowns. As a result, the GBPUSD pair fell from 1.30 to 1.15 in two weeks, for a loss of nearly 15%.
In 2022, the Cable started to decline amid the tightening monetary policy in the US, sending the GBPUSD pair below the 1.20 level as the Fed remains more hawkish than the Bank of England.
Source: Purple Trading Metatrader 4
GBPUSD - quotes and trading
The GBPUSD currency pair is available for trading on our Purple Trading Metatrader 4 platform. First, choose the new order button after finding the ticker GBPUSD on the Metatrader 4 interface. The following window will appear.
Source: Purple Trading Metatrader 4
Lot value calculation
When you open our Metatrader 4 platform and click on the GBPUSD ticker, you'll see that there is often a 1 pip spread between the Ask and the Bid price during periods of high liquidity (usually when London and New York are open for trading).
One micro lot is the minimum volume for trading GBPUSD (0.01). If you trade a mini lot (0.1), you will gain or lose 10 USD for each 10 pips GBPUSD makes. Every 10 pips of GBPUSD movement will yield 50 USD profit/loss when trading half a lot. For example, you buy half a lot at 1.20, and GBPUSD goes to 1.2050. Your total profit will be 250 USD (calculated as 50 pips movement * 50 USD profit per 10 pips of the move). When entering a short position, the same principle determines your profit or loss.
The GBPUSD is priced in US dollars, so keep that in mind. Therefore, whether your account is in EUR or another currency, your profit or loss must be converted to EUR at the current exchange rate.
You have the option of trading at market price (market execution) or using pending orders (limit and stop orders). In addition, you can start trading without the stop-loss and take-profit orders and add them later.