Profit and loss in forex trading depend on the price movement of the currency pair you are trading:
• Profit: If the price moves in your predicted direction (e.g., the base currency appreciates), you earn a profit in forex trading.
• Loss: If the price moves against your prediction (e.g., the base currency depreciates), you incur a loss in forex trading.
The extent of profit or loss is determined by the position size (lot size) and the number of pips the price moves.