Pip
Definition
The smallest standard price move in a currency pair.
Pip is the smallest standard price move in a currency pair, typically measured in the fourth decimal place for most pairs, and in the second decimal place for Japanese Yen pairs.
Pips matter to Forex traders as they determine the smallest price change that can occur, and thus the smallest profit or loss that can be made on a trade. For example, if a trader buys a currency pair at 1.2000 and sells it at 1.2005, they have made a profit of 5 pips.