Execution Physics.
Trading is the art of precise execution. Beyond prediction lies the orchestration of **Pips**, **Lots**, and **Institutional Order Flow**—the mechanical foundation of capital preservation.
The Axioms of Pips
A **Pip** (Price Interest Point) is the standardized unit of measurement for currency price movements. It represents the smallest significant price change in a given currency pair.
- The Standard Pip: For most pairs (EUR/USD, GBP/USD), a pip is the 4th decimal place (0.0001).
- The JPY Exception: In Japanese Yen pairs (USD/JPY, EUR/JPY), a pip is the 2nd decimal place (0.01) due to the relative value of the Yen.
- Fractional Pips (Pipettes): Modern institutional feeds use a 5th decimal (or 3rd for JPY) to track sub-pip liquidity, allowing for more precise execution in high-frequency environments.
Lot Stratification & Margin Orchestration
In the institutional domain, capital is deployed in standardized "Lots." The lot size determines your **Contract Value** and the monetary value of every pip movement.
100,000 units. Typically ~$10 per pip. Used by professional risk-takers.
10,000 units. Typically ~$1 per pip. The gateway to professional scaling.
1,000 units. Typically ~$0.10 per pip. Ideal for psychological conditioning.
**Leverage Axiom**: Leverage is not free money; it is a capital multiplier that amplifies both the velocity of gains and the lethality of losses.
Institutional Order Physics
The market moves based on the interaction between different order types. Understanding how to use them is the difference between a trader and a gambler.
1. Liquidity Consumption
Market Execution: Buying or selling instantly at the "best available" price. This consumes existing liquidity and is used when immediate entry is prioritized over price precision.
2. Liquidity Provision
Limit Orders: Buy/Sell Limit orders are placed *below* or *above* current price. They provide liquidity to the market and ensure you enter only at your desired price point.
3. Momentum Triggers
Stop Orders: Buy/Sell Stop orders trigger only *after* the price breaks a specific level. They are used to capture breakout momentum once a level is breached.
4. Stop Loss Physics
A Stop Loss is a protective Sell Stop (for buys) or Buy Stop (for sells). In the Skillforge methodology, we treat the SL as a **Hard Invalidation Level** of our thesis.
Advanced Mastery Hook
Retail traders often find their "Stop Loss" hunted by market makers. In the **Skillforge Master Class**, we teach the **Order Flow Orchestration** strategy—learning to identify institutional "Stop Runs" and entering where the herd is being liquidated.
Advanced Mastery is reserved for the Skillforge Master Class.
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