Forex Education

A type of chart which consists of four significant points: the high and the low prices, which form the vertical bar; the opening price, which is marked with a horizontal line to the left of the bar; and the closing price, which is marked with a horizontal line to the right of the bar.

A certain price of great importance included in the structure of a Barrier Option. If a Barrier Level price is reached, the terms of a specific Barrier Option call for a series of events to occur.

Any number of different option structures (such as knock-in, knock-out, no touch, double-no-touch-DNT) that attaches great importance to a specific price trading.

The first currency in a currency pair. It shows how much the base currency is worth as measured against the second currency. For example, if the USD/CHF (U.S. Dollar/Swiss Franc) rate equals 1.6215, then one USD is worth CHF 1.6215.

The lending rate of the central bank of a given country.

The Canadian dollar, also known as Loonie or Funds.

A currency trade which exploits the interest rate difference between two countries. By selling a currency with a low rate of interest and buying a currency with a high rate of interest, the trader will receive the interest difference between the two countries while this trade is open.

This is a fee that the client has to pay to keep a position open overnight. From Wednesday to Thursday swaps are calculated in triple size (for the weekend).

The price of a product for instant delivery; i.e., the price of a product at that moment in time.

Abbreviation referring to central banks.

A term that denotes a trade done at the current market price. It is a live trade as opposed to an order.

An individual or firm that acts as a principal or counterpart to a transaction. Principals take one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party.

A trade where both sides make and take actual delivery of the product traded.

The ratio between the change in price of a product and the change in price of its underlying market.

The decrease in value of an asset over time.

The currency of the Eurozone.

A market that is thought to have traveled too far, too fast.

A share bought in which the buyer forgoes the right to receive the next dividend and instead it is given to the seller.

The Federal Reserve Bank, the central bank of the United States, or the FOMC (Federal Open Market Committee), the policy-setting committee of the Federal Reserve.

When an order has been fully executed.

All positions opened within a particular currency pair are liquidated in the order in which they were originally opened.

Group of 8 – G7 nations plus Russia.

A quick market move in which prices skip several levels without any trades occurring. Gaps usually follow economic data or news announcements.

An index of the top 30 companies (by market capitalization) listed on the German stock exchange – another name for the DAX.

Refers to a bid being hit or selling interest.

It is commonly accepted that gold moves in the opposite direction of the US dollar. The long-term correlation coefficient is largely negative, but shorter-term correlations are less reliable.

A country’s monetary policymakers are referred to as hawkish when they believe that higher interest rates are needed, usually to combat inflation or restrain rapid economic growth or both.

A position or combination of positions that reduces the risk of your primary position.

To sell at the current market bid.

Names for the Hong Kong Hang Seng index.