Spread

The spread is the difference between the ask (the price you buy at) and the bid (the price you sell at). It represents the cost of entering a trade, since a new position starts a fraction below break-even by exactly that amount.

Spreads tighten when liquidity is high, such as during the London–New York overlap, and widen during quiet hours, at rollover and around major news. They matter most on strategies targeting only a few pips.