Accrual refers to the allocation of premiums and discounts in forward exchange transactions specifically tied to deposit swap (interest arbitrage) arrangements, throughout the duration of each respective deal.
Adjustment is the official response typically triggered by a shift, whether in internal economic policies aimed at rectifying a payment imbalance or in the official currency rate.
Traders and/or price action are displaying determination and assertiveness.
A financial expert proficient in assessing investments, formulating buy, sell, and hold recommendations for clients.
Appreciation occurs when a product strengthens in price due to increased market demand.
Arbitrage is the simultaneous purchase or sale of a financial product to exploit minor price differences between markets.
Asian Central Banks pertain to the central banks or monetary authorities o f Asian countries. These institutions actively manage significant foreign currency reserves, often derived from trade surpluses, influencing short-term currency direction.
Asian Central Banks pertain to the central banks or monetary authorities of Asian countries. These institutions actively manage significant foreign currency reserves, often derived from trade surpluses, influencing short-term currency direction.
The Asian Session spans from 23:00 to 08:00 GMT.
The Ask price, also known as the Offer, is the rate at which the market is willing to sell a product. In FX trading, it represents the cost of buying the base currency in a currency pair.
"At best" is an instruction directing a dealer to execute a transaction at the most favourable rate available at a specific moment.
"At or better" is an instruction to a dealer to execute a transaction at a specified price or a more favourable one.
AUS 200 refers to the Australian Securities Exchange (ASX 200), an index comprising the top 200 companies listed on the Australian Stock Exchange.
"Aussie" is a colloquial term for the AUD/USD (Australian Dollar/U.S. Dollar) currency pair. It's also referred to as "Oz" or "Ozzie."
Balance of trade refers to the value of a country's exports minus its imports.
A bar chart is a type of chart that consists of four significant points: the high and low prices, forming the vertical bar; the opening price, marked with a horizontal line to the left of the bar; and the closing price, marked with a horizontal line to the right of the bar.
Barrier level is a specific price of great importance included in the structure of a Barrier Option. If the Barrier Level price is reached, the terms of a particular Barrier Option call for a series of events to occur.
Barrier option refers to various option structures (such as knock-in, knock-out, no-touch, double-no-touch-DNT) that attach great importance to a specific trading price. In a no-touch barrier, a sizable defined payout is awarded to the option buyer if the strike price is not 'touched' before expiry, creating incentives for both the buyer and the seller.
Base currency is the first currency in a currency pair, representing its value against the second currency. In forex trading, the US dollar is usually the base currency, except for exceptions like the British pound, the euro, and the Australian dollar.
Base rate is the lending rate of a given country's central bank.
Basing is a chart pattern used in technical analysis, indicating a narrow trading range where demand and supply for a product are nearly equal.
A basis point is a unit of measurement describing the minimum change in the price of a product.
Bearish or bear market refers to a negative price direction, indicating a declining market. For example, being "bearish EUR/USD" means expecting the euro to weaken against the dollar.
Bears are traders who anticipate price declines and may hold short positions.
Bid/Ask spread is the difference between the bid and ask (offer) prices.
Bid price is the price at which the market is willing to buy a product. In forex trading, it represents the cost of selling the base currency in a pair.
Big figure refers to the first three digits of a currency quote, such as 117 USD/JPY or 1.26 in EUR/USD.
BIS, the Bank for International Settlements in Basel, Switzerland, acts as the central bank for central banks.
Black box is a term for systematic, model-based, or technical traders.
Blow-off is the upside equivalent of capitulation, occurring when shorts cover remaining short positions.
BOC stands for the Bank of Canada, Canada's central bank.
BOE stands for the Bank of England, the central bank of the UK.
BOJ stands for the Bank of Japan, Japan's central bank.
Bollinger Bands are a tool used by technical analysts, showing support and resistance levels by plotting two standard deviations on either side of a simple moving average.
Bond is a name for debt issued for a specified period.
In a professional trading environment, a book is the summary of a trader's or desk's total positions.
BRC Shop Price Index is a British measure of the rate of inflation at surveyed retailers.
Broker is an individual or firm acting as an intermediary, bringing buyers and sellers together for a fee.
Buck is market slang for one million units of a dollar-based currency pair or for the US dollar in general.
Bullish or bull market favours a strengthening market with rising prices.
Bulls are traders expecting prices to rise, often holding long positions.
Bundesbank is Germany's central bank.
Buy refers to taking a long position on a product.
Buying dips involves looking to buy 20-30-pip/point pullbacks in the course of an intra-day trend.
Cable refers to the GBP/USD (Great British Pound/U.S. Dollar) currency pair. The nickname "Cable" originated in the mid-1800s when the exchange rate was transmitted to the U.S. via a transatlantic cable, particularly when the GBP was the international trade currency.
CAD represents the Canadian dollar, also known as Loonie or Funds.
A call option is a currency trade exploiting the interest rate difference between two countries. By selling a currency with a low-interest rate and buying a currency with a high-interest rate, the trader earns the interest difference while the trade remains open.
The Canadian Ivey Purchasing Managers Index is a monthly measure of Canadian business sentiment issued by the Richard Ivey Business School.
A candlestick chart indicates the day's trading range, opening and closing prices. If the open price is higher than the close price, the chart is shaded, and vice versa.
Capitulation is a point at the end of an extreme trend when traders holding losing positions exit, signalling an expected reversal.
A carry trade is a strategy capturing the interest rate difference by being long a currency with a high-interest rate and short a currency with a lower interest rate.
The cash market is the actual underlying market on which a derivatives contract is based.
The cash price is the product's price for instant delivery, reflecting the current price.
CBS is an abbreviation referring to central banks.
A central bank is a government or quasi-governmental organization managing a country's monetary policy.
CFDs (Contracts for Difference) are derivatives providing exposure to the change in the value of an underlying asset without owning it. Traders can leverage their capital and gain benefits without owning the product.
A chartist, also known as a technical trader, interprets historical data using charts and graphs to identify trends and predict future movements.
Choppy refers to short-lived price moves with limited follow-through, unsuitable for aggressive trading.
Cleared funds are funds freely available and sent in to settle a trade.
Clearing is the process of settling a trade.
A closed position refers to exposure to a financial contract, like currency, that no longer exists. Closing a position involves placing an equal and opposite deal to offset the open position.
Closing is the process of stopping a live trade by executing a trade that is the exact opposite of the open trade.
The closing price is the price at which a product was traded to close a position or the price of the last transaction in a day trading session.
Collateral is an asset given to secure a loan or as a guarantee of performance.
A commission is a fee charged for buying or selling a product.
Commodity currencies refer to currencies from economies heavily reliant on natural resources, often specifically including Canada, New Zealand, Australia, and Russia.
Components are the dollar pairs that constitute the crosses, such as EUR/USD + USD/JPY making up EUR/JPY. Selling the cross through the components involves selling the dollar pairs alternately to create a cross position.
CompX is the symbol for the NASDAQ Composite Index.
Confirmation is a document exchanged by counterparts to a transaction, stating the terms of the transaction.
Consolidation is a period of range-bound activity following an extended price move.
Construction spending measures the amount spent on new construction, released monthly by the U.S. Department of Commerce's Census Bureau.
Contagion is the tendency of an economic crisis to spread from one market to another.
A contract is the standard unit of forex trading.
A contract note is a confirmation sent outlining the exact details of a trade.
Contract size is the notional number of shares one CFD represents.
Controlled risk is a position with limited risk due to a Guaranteed Stop.
Convergence of MAs is a technical observation describing moving averages of different periods moving toward each other, often forecasting price consolidation.
Corporate action is an event that changes the equity structure (and usually share price) of a stock, such as acquisitions, dividends, mergers, splits, and spinoffs.
Corporates refer to corporations in the market for hedging or financial management purposes, with their interest sometimes being less price-sensitive and more long-term compared to speculative funds.
The counter currency is the second listed currency in a currency pair.
Counterparty refers to one of the participants in a financial transaction.
Country risk is the risk associated with a cross-border transaction, including legal and political conditions.
CPI is the acronym for Consumer Price Index, a measure of inflation.
Crater signifies that the market is poised for a significant sell-off.
A cross is a pair of currencies that does not include the U.S. dollar.
Crown currencies refer to CAD (Canadian Dollar), Aussie (Australian Dollar), Sterling (British Pound), and Kiwi (New Zealand Dollar) – countries off the Commonwealth.
CTAs refer to commodity trading advisors, speculative traders whose activity can resemble that of short-term hedge funds, often associated with Chicago-based or futures-oriented traders.
Currency is any form of money issued by a government or central bank, used as legal tender and a basis for trade.
A currency pair consists of the two currencies that make up a foreign exchange rate, such as EUR/USD (Euro/U.S. Dollar).
Currency risk is the probability of an adverse change in exchange rates.
Currency symbols are three-letter symbols representing specific currencies, such as USD (U.S. Dollar).
The current account is the sum of the balance of trade, net factor income, and net transfer payments, with the balance of trade typically being a key component.
Day traders are speculators who take positions in commodities and then liquidate those positions before the close of the same trading day.
Day trading involves making an open and close trade in the same product within one trading day.
A deal refers to a trade executed at the current market price, representing a live trade as opposed to an order.
A dealer is an individual or firm acting as a principal or counterpart to a transaction. Dealers take one side of a position, aiming to earn a spread by closing out the position in a subsequent trade with another party.
Defending a level involves actions taken by a trader or group of traders to prevent a product from trading at a certain price or price zone, often because of a vested interest, such as a barrier option.
A deficit refers to a negative balance of trade or payments.
Delisting is the removal of a stock's listing on an exchange.
Delivery is a trade where both sides make and take actual delivery of the traded product.
Delta is the ratio between the change in price of a product and the change in price of its underlying market.
DCLG UK House Prices is a monthly survey produced by the Department of Communities and Local Government that uses a large sample of completed house sales to measure price trends in the UK real estate market.
Depreciation is the decrease in the value of an asset over time.
A derivative is a financial contract whose value is based on the value of an underlying asset, with common underlying assets being indices, equities, commodities, and currencies.
Devaluation occurs when a pegged currency is allowed to weaken or depreciate based on official actions, contrasting with revaluation.
The discount rate is the interest rate that an eligible depository institution is charged to borrow short-term funds directly from the Federal Reserve Bank.
Divergence in technical analysis refers to a situation where price and momentum move in opposite directions, either positively (bullish) or negatively (bearish). Divergence signals major shifts in price direction.
Divergence of MAs is a technical observation describing moving averages of different periods moving away from each other, generally forecasting a price trend.
A dividend is the amount of a company's earnings distributed to its shareholders, usually described as a value per share.
DJIA or Dow is the abbreviation for the Dow Jones Industrial Average or US30.
Dove or dovish refers to data or a policy view suggesting easier monetary policy or lower interest rates, opposite to hawkish.
Downtrend is price action consisting of lower lows and lower highs.
DXY$Y is the symbol for the US Dollar Index.
ECB stands for the European Central Bank, the central bank for the countries using the euro.
An economic indicator is a government-issued statistic indicating current economic growth and stability. Common indicators include employment rates, Gross Domestic Product (GDP), inflation, retail sales, etc.
An End of Day Order is an order to buy or sell at a specified price that remains open until the end of the trading day, typically at 5 pm/17:00 New York time.
EST/EDT represents the time zone of New York City, standing for United States Eastern Standard Time/Eastern Daylight Time.
ESTX50 is a name for the Euronext 50 index.
Euro is the currency of the Eurozone.
EMU is an umbrella name for the group of policies that aims to coordinate economic and fiscal policies across EU Member States.
The European session occurs from 07:00 to 16:00 (London time).
The Eurozone Labor Cost Index measures the annualized rate of inflation in the compensation and benefits paid to civilian workers and is seen as a primary driver of overall inflation.
The Eurozone OECD Leading Indicator is a monthly index produced by the OECD, measuring overall economic health by combining ten leading indicators.
Ex-dividend refers to a share bought in which the buyer forgoes the right to receive the next dividend, and instead, it is given to the seller.
The expiry date/price is the precise date and time when an option will expire. The two most common option expiries are 10:00 am ET (also referred to as 10:00 NY time or NY cut) and 3:00 pm Tokyo time (also referred to as 15:00 Tokyo time or Tokyo cut).
Exporters are corporations that sell goods internationally, making them sellers of foreign currency and buyers of their domestic currency. This term frequently refers to major Japanese corporations such as Sony and Toyota, who are natural sellers of USD/JPY, exchanging dollars received from commercial sales abroad.
Extended refers to a market that is thought to have travelled too far, too fast.
Factory orders refer to the dollar level of new orders for both durable and nondurable goods. This report provides more in-depth information than the durable goods report, which is released earlier in the month.
FED stands for 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.
FED officials refer to members of the Board of Governors of the Federal Reserve or regional Federal Reserve Bank Presidents.
Figure or "the figure" refers to the price quotation of '00' in a price such as 00-03 (1.2600-03) and would be read as ‘figure-three.’ If someone sells at 1.2600, traders would say 'the figure was given' or 'the figure was hit.
When an order has been fully executed.
Fill or kill is an order that, if it cannot be filled in its entirety, will be cancelled.
All positions opened within a particular currency pair are liquidated in the order in which they were originally opened.
A fix is one of approximately five times during the forex trading day when a large amount of currency must be bought or sold to fill a commercial customer’s orders. The regular fixes are associated with market volatility and occur at specific times during the day.
Flat or flat reading refers to economic data readings matching the previous period’s levels that are unchanged.
Flat or square is dealer jargon used to describe a position that has been completely reversed, creating a neutral (flat) position.
Follow-through is fresh buying or selling interest after a directional break of a particular price level. The lack of follow-through usually indicates a directional move will not be sustained and may reverse.
FOMC stands for the Federal Open Market Committee, the policy-setting committee of the US Federal Reserve.
FOMC minutes are the written record of FOMC policy-setting meetings released three weeks following a meeting. The minutes provide more insight into the FOMC’s deliberations and can generate significant market reactions.
Foreign exchange, forex, or FX is the simultaneous buying of one currency and selling of another. The global market for such transactions is referred to as the forex or FX market.
A forward is the pre-specified exchange rate for a foreign exchange contract settling at some agreed future date, based on the interest rate differential between the two currencies involved.
Forward points are the pips added to or subtracted from the current exchange rate to calculate a forward price.
FRA40 is a name for the index of the top 40 companies (by market capitalization) listed on the French stock exchange, also known as CAC40.
FTSE 100 is the name of the UK 100 index.
Fundamental analysis is the assessment of all information available on a tradable product to determine its future outlook and predict where the price is heading. It involves both non-measurable and subjective assessments and quantifiable measurements.
Funds refer to hedge fund types active in the market. It is also used as another term for the USD/CAD (U.S. Dollar/Canadian Dollar) pair.
A future is an agreement between two parties to execute a transaction at a specified time in the future when the price is agreed upon in the present.
A futures contract is an obligation to exchange a good or instrument at a set price and specified quantity grade at a future date. The primary difference between a Future and a Forward is that Futures are typically traded over an exchange (Exchange-Traded Contracts – ETC), versus Forwards, which are considered Over The Counter (OTC) contracts. An OTC is any contract NOT traded on an exchange.
G7 refers to the Group of 7 Nations, which includes the United States, Japan, Germany, United Kingdom, France, Italy, and Canada.
G8 is the Group of 8, which includes the G7 nations plus Russia.
Gap or gapping is a quick market move in which prices skip several levels without any trades occurring. Gaps usually follow economic data or news announcements.
Gearing, also known as leverage, refers to trading a notional value that is greater than the amount of capital a trader is required to hold in their trading account. It is expressed as a percentage or a fraction.
GER30 is an index of the top 30 companies (by market capitalization) listed on the German stock exchange, another name for the DAX.
Given refers to a bid being hit or selling interest.
Giving it up occurs when a technical level succumbs to a hard-fought battle.
GMT stands for Greenwich Mean Time, the most commonly referred time zone in the forex market. GMT does not change during the year, as opposed to daylight savings/summer time.
Going long refers to the purchase of a stock, commodity, or currency for investment or speculation, with the expectation of the price increasing.
Going short is the selling of a currency or product not owned by the seller, with the expectation of the price decreasing.
Gold is commonly believed to move in the opposite direction of the US dollar. The long-term correlation coefficient is largely negative, but shorter-term correlations are less reliable.
A gold certificate is a certificate of ownership that gold investors use to purchase and sell the commodity instead of dealing with the transfer and storage of the physical gold itself.
The standard unit of trading gold is one contract, which is equal to 10 troy ounces.
An order that will expire at the end of the day if it is not filled.
A good 'til cancelled order is an order to buy or sell at a specified price that remains open until filled or until the client cancels.
A good 'til date order type will expire on the date you choose if it is not filled beforehand.
Greenback is a nickname for the US dollar.
Gross Domestic Product (GDP) is the total value of a country’s output, income, or expenditure produced within its physical borders.
Gross National Product is Gross Domestic Product plus income earned from investment or work abroad.
A guaranteed order is an order type that protects a trader against market gapping. It guarantees to fill your order at the price asked.
A guaranteed stop is a stop-loss order guaranteed to close your position at a level you dictate, should the market move to or beyond that point. It is guaranteed even if there’s gapping in the market.
Gunning or gunned refers to traders pushing to trigger known stops or technical levels in the market.
In the context of the FX market, a handle represents every 100 pips, starting with 000.
When a country's monetary policymakers are referred to as hawkish, it means they believe that higher interest rates are needed. This stance is often taken to combat inflation or restrain rapid economic growth or both.
A hedge is a position or combination of positions that reduces the risk of your primary position. It's a strategy used to offset potential losses in one investment by taking an opposite position in another.
To hit the bid means to sell at the current market bid. It implies a market order to sell at the best available price in the market.
HK50 or HKHI are names for the Hong Kong Hang Seng index. The Hang Seng is a market capitalization-weighted index of the largest companies that trade on the Hong Kong Exchange.
When a market is illiquid, it means there is little volume being traded. A lack of liquidity often creates choppy market conditions, and it can be challenging to buy or sell assets without causing significant price movements.
IMM stands for the International Monetary Market, which is the Chicago-based currency futures market and is part of the Chicago Mercantile Exchange.
IMM Futures refer to traditional futures contracts based on major currencies against the US dollar. These futures are traded on the floor of the Chicago Mercantile Exchange.
The IMM session refers to the trading hours of the International Monetary Market, which is from 8:00 am to 3:00 pm New York time.
INDU is an abbreviation for the Dow Jones Industrial Average, a widely followed stock market index.
Industrial production measures the total value of output produced by manufacturers, mines, and utilities. This economic indicator reacts quickly to expansions and contractions in the business cycle and can serve as a leading indicator for employment and personal income data.
Inflation is an economic condition where prices for consumer goods rise, eroding purchasing power.
The initial margin requirement is the initial deposit of collateral required to enter into a position, typically in the context of trading financial derivatives.
Interbank rates are the foreign exchange rates at which large international banks quote to each other. These rates play a crucial role in the foreign exchange market.
In the context of CFDs (Contracts for Difference), interest refers to adjustments in cash to reflect the effect of owing or receiving the notional amount of equity in a CFD position.
Intervention occurs when a central bank takes action to affect the value of its currency by entering the market. The concerted intervention involves coordinated action by multiple central banks to control exchange rates.
An introducing broker is a person or corporate entity that introduces accounts to a broker in return for a fee. They act as intermediaries between clients and brokers.
INX is the symbol for the S&P 500 index, another widely followed stock market index.
IPO stands for Initial Public Offering, which is a private company's initial offer of stock to the public. It marks the company's transition from private to public ownership.
The Japanese Economy Watchers Survey measures the mood of businesses that directly service consumers, such as waiters, drivers, and beauticians. Readings above 50 generally signal improvements in sentiment, providing insights into the confidence levels of service-oriented businesses.
Japanese Machine Tool Orders measure the total value of new orders placed with machine tool manufacturers. Machine tool orders are considered a leading indicator of future industrial production. Strong data in this indicator generally signals that manufacturing is improving, suggesting economic expansion.
JPN225 is a name for the Nikkei 225 index, which is a stock market index for the Tokyo Stock Exchange (TSE). It represents the performance of 225 large, publicly traded companies in the Japanese market and is one of the most widely followed indices for the Japanese stock market.
The expression "keep the powder dry" means to limit your trades due to unfavourable or uncertain trading conditions. It suggests refraining from active trading in choppy or extremely narrow markets and waiting on the sidelines until a clear and favourable opportunity arises.
"Kiwi" is a nickname for the NZD/USD currency pair, representing the New Zealand Dollar against the U.S. Dollar. The term is derived from the kiwi bird, which is native to New Zealand and is also a symbol of the country.
Knock-ins are an option strategy that requires the underlying product to trade at a certain price before a previously bought option becomes active. This strategy is used to reduce premium costs of the underlying option and can trigger hedging activities once the option is activated.
Knock-outs are options that nullify a previously bought option if the underlying product trades at a certain level. When a knock-out level is reached, the underlying option ceases to exist, and any hedging positions may need to be unwound.
The last dealing day refers to the final day on which you may trade a particular financial product. It marks the deadline for trading that specific instrument.
The last dealing time is the final time at which you may execute a trade for a particular financial product. It signifies the closing time for trading that specific instrument.
Leading indicators are economic statistics or metrics that are considered predictive of future economic activity. They are used by analysts and traders to anticipate changes in economic trends.
In trading, a level refers to a specific price zone or particular price that is deemed significant from a technical standpoint or based on reported orders and option interest. Traders often pay attention to these levels for potential support or resistance.
Leverage, also known as margin, is the percentage or fractional increase that allows traders to trade with an amount of capital greater than what they have available. It amplifies both potential profits and potential losses.
Leveraged names typically refer to short-term traders, often associated with the hedge fund community, who engage in trading activities using leverage to magnify their market exposure.
In financial terms, liability refers to potential loss, debt, or financial obligation that an individual or entity may be responsible for.
LIBOR stands for the London Inter-Bank Offered Rate. It is a benchmark interest rate that banks use as a base rate for international lending. LIBOR is often used as a reference for various financial products.
A limit order is an order placed to buy at a price below the current market or sell at a price above the current market. It sets restrictions on the maximum price to be paid or the minimum price to be received.
A liquid market is one with sufficient numbers of buyers and sellers, allowing prices to move smoothly. In a liquid market, there is ample trading activity and low bid-ask spreads.
Liquidation refers to the process of closing an existing position through the execution of an offsetting transaction. It involves selling long positions or covering short positions to exit the market.
The London session is a specific time period during which the London financial markets are open for trading. It typically occurs from 08:00 to 17:00 London time.
A macro trader is the longest-term trader who makes trade decisions based on fundamental analysis. Macro trades typically have a holding period that can extend from around six months to multiple years. These traders focus on broad economic factors and trends.
Manufacturing production measures the total output of the manufacturing aspect of industrial production. It specifically includes the 13 sub-sectors directly related to manufacturing, constituting approximately 80% of total industrial production.
A margin call is a request from a broker or dealer for additional funds or other collateral on a position that has moved against the customer. It is issued to ensure that the trader has sufficient funds to cover potential losses.
A market maker is a dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial product. Market makers facilitate trading by providing liquidity to the market.
A market order is an order to buy or sell a financial product at the current market price. It is executed immediately at the best available price.
Market-to-market refers to the process of re-evaluating all open positions in light of current market prices. This revaluation determines the current value of open positions and, subsequently, the margin requirements.
The maturity of a financial product refers to the date of settlement or expiry. It is the point in time when the financial instrument ceases to exist or is settled.
The Medley report comes from Medley Global Advisors, a market consultancy known for maintaining close contacts with central banks and government officials worldwide. These reports, claiming to have inside information from policymakers, can influence the currency market, although their accuracy has varied over time.
Models, often synonymous with "black box," are systems that automatically buy and sell based on technical analysis or other quantitative algorithms. These automated trading systems operate without direct human intervention.
MOM is an abbreviation for "month-over-month," representing the change in a data series relative to the prior month's level. It is commonly used in economic and financial analysis to assess monthly variations.
Momentum refers to a series of technical studies (e.g., RSI, MACD, Stochastics, Momentum) that assess the rate of change in prices. Momentum indicators help traders identify the strength and direction of a trend.
Momentum players are traders who align themselves with an intra-day trend, aiming to capture relatively short-term price movements, often in the range of 50-100 pips.
NAS100 is an abbreviation for the NASDAQ 100 index. The NASDAQ 100 is a stock market index that includes 100 of the largest non-financial companies listed on the NASDAQ stock exchange.
Net position refers to the amount of currency bought or sold by a trader that has not yet been offset by opposite transactions. It represents the trader's overall exposure to a particular currency.
The New York session in the forex market is the period from 8:00 am to 5:00 pm New York time. It is a significant trading session characterized by increased liquidity, especially when it overlaps with other major sessions.
No Touch is an option type that pays a fixed amount to the holder if the market never touches a predetermined barrier level. It is a type of binary option where the trader predicts that the market price will not reach a specified level during a specified period.
NYA.X is the symbol for the NYSE Composite index. The NYSE Composite index represents the performance of all common stocks listed on the New York Stock Exchange (NYSE). It serves as an indicator of the overall health of the NYSE market.
The offer/ask price, also known as the ask price, is the price at which the market is prepared to sell a financial product. In currency pairs, it is the price at which a trader can buy the base currency. For example, in the quote USD/CHF 1.4527/32, the ask price is 1.4532, indicating that you can buy one US dollar for 1.4532 Swiss francs. </br> </br> In CFD trading, the ask price represents the price at which a trader can buy the product. For instance, in the quote for UK OIL 111.13/111.16, the ask price is £111.16 for one unit of the underlying market.
If a market is said to be trading offered, it means that the pair is attracting heavy selling interest or offers from traders.
An offsetting transaction is a trade that cancels or offsets some or all of the market risk of an open position. It is a way to neutralize or close an existing trade.
The term "on top" is used when a trader is attempting to sell at the current market order price. It indicates a willingness to sell at the best available price.
One Cancels the Other (OCO) is a designation for two orders where if one part of the two orders is executed, the other is automatically cancelled. It allows traders to set both a stop-loss and a take-profit order simultaneously.
One Touch is an option type that pays a fixed amount to the holder if the market touches a predetermined barrier level. It is a binary option where the trader predicts that the market price will touch a specified level during a specified period.
An open order is an instruction to execute a trade when the market moves to its designated price. It is often associated with good 'til cancelled orders.
An open position is an active trade with corresponding unrealized profit and loss (P&L) that has not been offset by an equal and opposite deal. It represents the exposure a trader has in the market.
An option is a derivative that gives the holder the right, but not the obligation, to buy or sell a financial product at a specific price before a specified date.
An order is an instruction given by a trader to execute a trade at a specified price.
An order book is a system used to show the market depth of traders willing to buy and sell at prices beyond the best available.
Over the Counter (OTC) is used to describe any transaction that is not conducted via an exchange. OTC trading occurs directly between two parties.
"Paid" refers to the offer side of the market dealing. It indicates that there is buying interest or bids in the market.
In the forex market, a pair refers to the quoting convention of matching one currency against the other. For example, in the currency pair EUR/USD, the euro is being compared against the U.S. dollar.
"Paneled" is a term used to describe a very heavy round of selling in the market. It signifies a significant and strong selling activity.
"Parabolic" describes a market that moves a great distance in a very short period, often in an accelerating fashion resembling one-half of a parabola. Parabolic moves can be either upward or downward.
A partial fill occurs when only part of an order has been executed. It indicates that only a portion of the intended trade has been completed.
Being patient in trading refers to waiting for certain levels or news events to hit the market before entering a position. Traders may exercise patience to ensure favourable conditions for their trades.
Personal income measures an individual's total annual gross earnings from wages, business enterprises, and various investments. It is a key factor influencing personal spending, which, in turn, accounts for a significant portion of GDP in major economies.
Pips are the smallest unit of price for any foreign currency. They refer to digits added to or subtracted from the fourth decimal place, e.g., 0.0001.
Political risk refers to exposure to changes in governmental policy that may have an adverse effect on an investor's position. It includes the potential impact of political events on financial markets.
A portfolio is a collection of investments owned by an individual or entity. It includes various financial instruments such as stocks, bonds, and other assets.
Position refers to the net total holdings of a given financial product. It represents the overall exposure or investment in a particular market.
Premium is the amount by which the forward or futures price exceeds the spot price. It is often associated with options trading, where it represents the cost of the option.
Price transparency describes quotes to which every market participant has equal access. It emphasizes fair and equal visibility of market prices.
Profit is the difference between the cost price and the sale price, realized when the sale price is higher than the cost price. It is a key metric in assessing financial performance.
A pullback is the tendency of a trending market to retrace a portion of its gains before continuing in the same direction. It is a temporary reversal within a larger trend.
PMI is an economic indicator that indicates the performance of manufacturing companies within a country. It is based on surveys of purchasing managers and provides insights into economic conditions.
These indices measure the outlook of purchasing managers in the service sector. Readings above 50 generally indicate expansion, while readings below 50 suggest economic contraction.
A put option is a financial product that gives the owner the right, but not the obligation, to sell the underlying asset at a specified price within a specified period.
Quantitative easing (QE) is a monetary policy tool employed by a central bank to inject money into an economy with the aim of stimulating growth. This is often done by purchasing financial assets, such as government bonds, to increase the money supply and lower interest rates.
Quarterly CFDs refer to a type of futures contract with expiry dates every three months, occurring once per quarter. CFDs, or Contracts for Difference, are derivative products that allow traders to speculate on the price movements of financial instruments without actually owning the underlying asset.
A quote in the financial context refers to an indicative market price. It is a displayed price that provides information about the current market value of a financial instrument. Quotes are typically used for informational purposes, and the actual transaction may occur at a slightly different price, known as the execution price.
A rally refers to a recovery in the price of a financial instrument after a period of decline. It is characterized by an upward movement in prices.
A range is a term used to describe a situation where the price of a financial instrument is trading between a defined high and low, moving within these two boundaries without breaking out from them.
Rate, in the context of trading, typically refers to the exchange rate, representing the price of one currency in terms of another. It is a crucial factor in currency trading.
RBA stands for the Reserve Bank of Australia, which is the central bank of Australia responsible for monetary policy and issuing the country's currency.
RBNZ stands for the Reserve Bank of New Zealand, the central bank of New Zealand responsible for monetary policy and the issuance of the New Zealand Dollar.
Real money refers to traders of significant size, including pension funds, asset managers, insurance companies, etc. These participants are viewed as indicators of major long-term market interest, in contrast to shorter-term, intra-day speculators.
Realized profit/loss is the actual amount of money a trader has made or lost when a position has been closed.
A resistance level is a price level that may act as a ceiling, where the price tends to stall or reverse. It is the opposite of support.
A retail investor is an individual investor who trades with personal wealth, as opposed to trading on behalf of an institution.
Retail sales measure the monthly sales of all goods and services sold by retailers. It provides insight into consumer spending behaviour, a key determinant of economic growth.
Revaluation occurs when a pegged currency is allowed to strengthen or rise as a result of official actions. It is the opposite of devaluation.
A rights issue is a corporate action where existing shareholders are given rights to purchase additional stock, often used by companies to raise capital.
Risk refers to exposure to uncertain change, often used with a negative connotation of adverse change.
Risk management involves employing financial analysis and trading techniques to reduce and/or control exposure to various types of risk.
Rollover in the forex market refers to the simultaneous closing of an open position for today's value date and the opening of the same position for the next day's value date, reflecting the interest rate differential between the two currencies.
A round trip is a trade that has been opened and subsequently closed by an equal and opposite deal.
Running profit/loss is an indicator of the status of open positions, representing unrealized money that would be gained or lost if all open positions were closed at that point in time.
RUT is the symbol for the Russell 2000 index, which represents the performance of 2,000 small-cap stocks in the United States.
The SEC, or Securities and Exchange Commission, is a regulatory body in the United States responsible for overseeing and regulating the securities industry, including securities exchanges and brokerage firms.
A sector refers to a group of securities that operate in a similar industry. Companies within the same sector are often subject to similar market dynamics and economic conditions.
Selling is the act of taking a short position in expectation that the market is going to go down. It involves selling a financial instrument with the intention of buying it back at a lower price.
Settlement is the process by which a trade is entered into the books, recording the counterparts to a transaction. In currency trades, settlement may or may not involve the actual physical exchange of one currency for another.
SHGA.X is the symbol for the Shanghai A index, representing the performance of A-shares listed on the Shanghai Stock Exchange.
Short-covering occurs when traders who had previously taken short positions (betting on a price decline) start buying back the assets to cover their positions, especially after a decline in prices.
A short position is an investment position that benefits from a decline in market price. It involves selling a financial instrument with the expectation that its price will decrease.
A short squeeze is a situation in which traders heavily positioned on the short side (betting on a price decline) are forced to cover their positions by buying, causing a sharp price increase.
Shorts refer to traders who have sold (or shorted) a financial product, indicating a bearish outlook on the market.
Traders staying out of the markets due to directionless, choppy, or unclear market conditions are said to be on the sidelines or sitting on their hands.
A simple moving average (SMA) is a technical analysis indicator that calculates the average closing price of a financial instrument over a specified number of periods. It provides a smoothed line representing the overall trend.
Slippage is the difference between the price that was requested and the price obtained, typically due to changing market conditions. It can occur when executing orders, and the actual execution price differs from the expected price.
"Slippery" is a term used when the market feels like it is ready for a quick move in any direction. It implies uncertainty and potential volatility.
"Sloppy" describes choppy trading conditions that lack a meaningful trend and/or follow-through. It suggests a lack of clear market direction.
SNB stands for the Swiss National Bank, which is the central bank of Switzerland responsible for monetary policy and the issuance of the Swiss Franc.
Sovereign names refer to central banks that are active in the spot market, particularly in the foreign exchange market.
The spot market is a market where financial products are traded at their current market price for immediate exchange.
The spot price is the current market price of a financial product. In currency trading, settlement of spot transactions usually occurs within two business days.
Support is a price level that acts as a floor for past or future price movements. It is a level where buying interest is expected to emerge.
Support levels are a technique used in technical analysis to identify specific price levels acting as a floor for past or future price movements. These levels are believed to be areas where the exchange rate is likely to experience buying interest, preventing it from falling further. Support levels are considered opposite to resistance levels, which act as a price ceiling.
Suspended trading refers to a temporary halt in the trading of a particular financial product. This suspension can occur for various reasons, such as significant market volatility, pending news announcements, or other extraordinary circumstances. During a suspension, trading activity is temporarily paused.
A swap is a financial derivative involving the simultaneous sale and purchase of the same amount of a given currency at a forward exchange rate. Swaps can be used for various purposes, including managing currency risk or adjusting the maturity of an investment portfolio.
"Swissie" is a nickname for the Swiss franc, the official currency of Switzerland. It is also used to refer to the USD/CHF (U.S. Dollar/Swiss Franc) currency pair, indicating the exchange rate between the U.S. dollar and the Swiss franc. The term "Swissie" is commonly used in the financial industry.
Take profit refers to the act of closing a trade when the market reaches a predefined profit level. It is often associated with limit orders that aim to sell above the level that was bought or buy back below the level that was sold.
A takeover occurs when one entity assumes control of another company by buying its stock. This can happen through various means, such as acquiring a majority of the company's shares.
Technical analysis involves studying charts of past price patterns to identify potential clues about the direction of future price movements. It focuses on historical market data, including price and volume, to make predictions about future market behaviour.
Technicians, also known as techs, are traders who base their trading decisions on technical or chart analysis. They analyse charts and use technical indicators to make informed decisions about when to enter or exit trades.
"TEN (10) YR" refers to US government-issued debt with a maturity of ten years. For example, a US 10-year note is a debt instrument that is repayable in ten years.
"Thin" describes an illiquid, slippery, or choppy market environment. It refers to a market with low trading volume, which can result in erratic and unpredictable trading conditions.
"THIRTY (30) YR" refers to UK government-issued debt with a maturity of 30 years. For example, a UK 30-year gilt is a debt instrument that is repayable in 30 years.
A tick is the minimum change in price, either up or down. Tick size refers to the smallest price movement that a particular financial product can make.
Time to maturity is the time remaining until a financial contract or instrument expires. It is particularly relevant in the context of bonds and other fixed-income securities.
The Tokyo session refers to the time during which the forex market is most active in Tokyo, Japan. It typically spans from 09:00 to 18:00 Tokyo time.
Tomorrow next (TOM/NEXT) involves the simultaneous buying and selling of a currency for delivery the following day. It is a short-term transaction that spans the transition from one trading day to the next.
T/P stands for "take profit," which is synonymous with the idea of closing a trade at a predetermined profit level.
The trade balance measures the difference in value between imported and exported goods and services. Nations with trade surpluses (exports greater than imports) tend to see their currencies appreciate, while those with trade deficits (imports greater than exports) may see their currencies weaken.
Trade size refers to the number of units of a financial product in a contract or lot. It indicates the quantity of the product being bought or sold in a particular trade.
Trading bid occurs when a currency pair is acting strong and moving higher. Bids keep entering the market and pushing prices up.
A trading halt is a temporary postponement to trading that does not involve a suspension from trading. It may be implemented to manage extreme market conditions or significant news events.
A market that feels like it wants to move lower is described as trading heavy. It is usually associated with an offered market that resists rallying despite buying attempts.
Trading offered describes a currency pair that is acting weak and moving lower. Offers to sell keep coming into the market.
A trading range is the range between the highest and lowest prices of a financial instrument over a specified period, expressing the price movement within those boundaries.
A trailing stop is a dynamic stop-loss order that allows a trade to continue gaining value as long as the market price moves in a favourable direction. It automatically closes the trade if the market price moves in an unfavourable direction by a specified distance.
Transaction cost is the cost associated with buying or selling a financial product. It includes expenses such as spreads, commissions, and other fees.
The transaction date is the date on which a trade occurs, marking the point at which the buyer and seller agree on the terms of the transaction.
A trend is the general direction in which the price of a financial instrument is moving. An uptrend is characterized by higher highs and higher lows, while a downtrend is characterized by lower highs and lower lows.
Turnover refers to the total money value or volume of all executed transactions in a given time period. It provides an indication of the level of trading activity in the market.
A two-way price is a quote that includes both a bid and offer rate for a forex transaction. It represents the price at which a trader can buy or sell a currency pair.
TYO10 is the symbol for the CBOE 10-Year Treasury Yield Index, reflecting the yield on 10-year US Treasury securities.
In financial terms, "ugly" is used to describe unforgiving market conditions that can be violent and quick. This typically refers to a market situation characterized by sharp and unpredictable movements, often leading to significant losses for traders.
This economic indicator measures the average wage, including or excluding bonuses, paid to employees in the United Kingdom. The data is usually reported on a quarter-on-quarter (QoQ) basis from the previous year. Including or excluding bonuses provides insight into different aspects of wage growth.
The UK Claimant Count Rate measures the number of people claiming unemployment benefits in the United Kingdom. It is an important indicator of labour market conditions. The claimant count figures may be lower than the overall unemployment data, as not all unemployed individuals are eligible for benefits.
The UK HBOS House Price Index measures the relative level of UK house prices. It is considered an indication of trends in the UK real estate sector, providing insight into the overall economic outlook. The index is published monthly by the Halifax Building Society/Bank of Scotland.
This economic indicator measures the change in the number of people claiming unemployment benefits in the United Kingdom over the previous month. It provides information about the dynamics of the labour market and is closely monitored for economic trends.
The UK Manual Unit Wage Loss measures the change in total labour cost expended in the production of one unit of output. It provides insights into labour cost dynamics and their impact on production costs.
"UK Oil" is a term used as a name for Brent Crude Oil, a major trading classification of sweet light crude oil that serves as a major benchmark price for purchases worldwide.
The UK Producers Price Index Input measures the rate of inflation experienced by manufacturers when purchasing materials and services. It is closely scrutinized as a leading indicator of consumer inflation.
The UK Producers Price Index Output measures the rate of inflation experienced by manufacturers when selling goods and services.
"UK100" is a name for the FTSE 100 index, which is a stock index representing the 100 largest companies listed on the London Stock Exchange.
Also known as the maturity date, the value date is the date on which counterparts to a financial transaction agree to settle their respective obligations by exchanging payments. In the context of spot currency transactions, the value date is typically set as two business days forward.
Variation margin refers to the funds that traders must hold in their accounts to meet the required margin necessary to cope with market fluctuations. It is a mechanism to ensure that traders have sufficient funds to cover potential losses as the market value of their positions changes.
The VIX, or Volatility Index, shows the market's expectation of 30-day volatility. It is constructed using the implied volatilities of a wide range of S&P 500 index options. The VIX is widely used as a measure of market risk and is often referred to as the "investor fear gauge." A higher VIX indicates higher expected volatility in the market.
Volatility refers to the degree of variation of a trading price series over time. In financial markets, it often indicates the level of uncertainty or risk. Active markets with frequent price movements are considered volatile, presenting trade opportunities for investors and traders.
A wedge chart pattern is a formation that depicts a narrowing price range over time. In an ascending wedge, the highs decrease incrementally, while in a descending wedge, the declines are incrementally smaller. Ascending wedges often lead to downside breakouts, and descending wedges typically result in upside breakouts.
Whipsaw is a term used to describe a highly volatile market where a sharp price movement is quickly followed by a sharp reversal. It reflects rapid and unpredictable market conditions, making it challenging for traders to anticipate price movements accurately.
Wholesale prices measure the changes in prices paid by retailers for finished goods. This economic indicator is closely monitored, as inflationary pressures in wholesale prices often precede those in the headline retail prices. It provides insights into the early stages of price changes in the production and distribution chain.
A working order refers to a situation where a limit order has been requested but has not yet been filled. It represents an order that is active in the market and waiting for execution at the specified price. Traders often use working orders to automate their trading strategies and enter or exit positions at predetermined levels.
WSJ is an acronym for The Wall Street Journal, a widely respected and influential financial newspaper that provides news and analysis on global business, finance, and economics.
XAG/USD is the symbol for the Silver Index. It represents the exchange rate between silver (XAG) and the US Dollar (USD) in the financial markets.
XAU/USD is the symbol for the Gold Index. Similar to XAG/USD, it represents the exchange rate between gold (XAU) and the US Dollar (USD) in the financial markets.
XAX.X is the symbol for the AMEX Composite Index. The AMEX Composite Index, also known as the AMEX, represents the performance of all the stocks listed on the NYSE American (formerly known as the American Stock Exchange or AMEX).
In financial terms, a "yard" is slang for a billion units. It is often used in the foreign exchange market to refer to a billion units of currency.
Yield is the percentage return on an investment. It is calculated as the annual dividend or interest income divided by the current price of the investment.
YOY is an abbreviation for "year over year." It is commonly used in financial and economic contexts to compare data or performance metrics for one year with the corresponding period in the previous year.
The yuan is the base unit of currency in China. The official name of the currency is the renminbi (RMB), and yuan is the primary unit of that currency.