Forex School

Lesson: 27- Forex glossary and guide

Greenlight sees small loss in June, JANA off a bit more
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Forex glossary and guide

Forex Glossary the words in the jargon of Forex This page contains technical terms of Forex, accompanied by a short description. For each run, you can access the description by clicking on the relevant term.

A

Adx : Technical Indicator assessing the strength of a trend, it does not give much for the senses.
Fundamental Analysis : economic information and news analysis can be used to predict the course of a financial market.
Technical Analysis : Empirical approach of providing the evolution of financial assets by studying advanced graphics.
Margin Call : If this capital on the account is too low, the broker makes a margin call in order to keep a position for which impairment involves too small margin.
Appreciation : A term commonly used to describe the increase in the value of a currency.
Arbitrage : Strategy of buying assets in one market and sell the same to another in order to earn the price difference between the two markets.
Ask : Price at which you buy a currency.
Atr : technical indicator to assess volatility

B

Trade Balance : Economic indicator for judging the balance of exports and imports of a country over a year. A positive balance is more favorable to the appreciation of the currency of the country where the relevant currency area.
Bollinger bands : Technical Indicator formed an upper band and a lower band limiting course, it helps to assess the volatility.
Bar chart : Graphical representation close to the Japanese candlestick, the difference comes at the candles on the bar chart there is no stain.
ECB : European Central Bank, it is responsible for setting monetary policy in the euro area.
Bear : Person with a bearish view on a market.
Abandoned Baby : It’s a separate doji gaps by two of its neighbors candles is a potential reversal signal.
Ben bernanke : Director of EDF.
Bid : This is the offer during that is the course where it is possible to enter an active seller.
Bevel : Chartist Figure showing breathlessness of a movement, a support and an oblique resistance contain courses but unlike the channel, these lines converged.
Boj : The BoJ (Bank Of Japan) is the central bank of Japan
Breakout : Breaking a horizontal level of support or resistance.
Broker Forex : Intermediate bank operations, it allows individuals and professionals directly trader in the foreign exchange market.
Bull : Person with a bullish view of the market.

C

Cable : jargon used to describe the currency parity stirling pound / US dollar
Trader : Trader dealing with the currency market.
Channel : Figure Chartist consisting of a support and a parallel resistance containing the courses.
Carry trade : trading method of carrying out its gains on the interest rate differential existing interest on a currency pair.
Break : There is talk of breakage since the current crossing a level of support or significant resistance.
ICC : The ICC is a technical indicator belonging to the family of oscillators. Basically only used on raw materials, it is now applied in many markets as the Forex for example.
Japanese candlestick : Graphic display with 4 information for each session, the closing price, the opening price, the highest and the lowest. This information is materialized in the form of candles.
Change Crusader : The exchange rate is considered non-compliant in the country. For example AUD / USD exchange rate crossed into France.
Chartist : empirical chart analysis approach introduced by J.Dow. It involves identifying and interpreting specific training courses taken by (triangles, channels, …).
Investment Club : physical persons group wishing to share their knowledge and experience of financial markets, each pays a sum of money in the account to quickly increase its capacity.
Iso code : code used to refer to a currency, for example AUD for Australian dollar.
Commodities : raw materials market.
Consolidation : A term commonly used to describe an evolving market flat or range (= being contained flat with a resistance and support).
Consideration : Organization is putting in front of you when selling or buying.
Technical correction : There is talk of technical correction when prices after scoring a strong movement are driven to make a small movement in the opposite direction.
Correlation : Selected pairs move in a similar way, are said to be correlated.
Signal curve : Very often a moving average, a signal curve is used to filter and to give signals, such as exponential moving average of the MACD.
Broker : Agent concerned with managing purchase orders or customers of foreign exchange sales.
Cross : A term used to refer to a currency pair

D

Day trading : trading method widely used. It involves going back and forth in a day, usually we cut positions prior periods of low liquidity.
Unbuckle position : Use for closing a position.
Devaluation : Action implemented by the central bank to reduce the value of a currency relative to others.
Currency uncertainty : Refers to the second currency of a cross, for example on AUD / USD, the US dollar is the currency in uncertain.
Currency at some : The first currency of the cross, one that will be bought or sold. For example on EUR / USD, the euro is certain.
Divergence : Divergence occurs once the current move inversely technical indicator in question.
DMI : Technical Indicator to clearly define key trends and providing input signals.
Double Hollow : Figure Chartist also known as the double bottom, consisting of two lower of the same height and a neck line, it announced an increase in passing.
Double tops : Figure Chartist also known as the double top, consists of two above the same height as well as a neck line, she announced a decrease in its clearance.
Flag : Figure Chartist continuation, it materializes as a Range occurring after a strong movement. The breakout of the range in the same direction as the previous acceleration gives an input signal.
Drawdown : Corresponds to the maximum fall on an account, on testing it measures the effectiveness of a strategy, the more the drawdown is low, the better the strategy.
Right Trend : bullish or bearish slant line can be used as kickback zone or dynamic fracture.

E

Ecn : The ECN brokers spend all their operations directly in the interbank market, they thus improve the transparency of transactions by displaying in real time the order books.
Leverage : Instrument available to the trader by the broker. It serves to amplify gains and losses, this by proposing to invest capital than the one on the account.
Fisher effect : Existing relationship between the nominal interest rate and inflation.
Encompassing bearish : Figure bearish bougiste materialized by a small size candle included in more that it is bearish.
Bounding upward : Figure bullish bougiste materialized by a small size candle included in more that it is bullish.
Morning Star : Figure bougiste of bullish reversal. It consists of three candles forming a hollow. The first candle is bearish for the second meaning the matter and the last to be bullish.
Evening Star : Figure bougiste of bearish reversal. It consists of three candles forming a peak. The first candle is bullish for the second meaning the matter and the last to be bearish.
Expert advisor : Computer program can manage independently the position of a strategy management.

F

Fed : US Central Bank.
FIFO : literally “first in, first out”. The rule is that the first open position to be the first to be closed.
Flat : Term used to describe a market neutral or without trend.
IMF : established in 1946, it’s role is primarily to manage the state debt problems by providing loans.
Hedge fund : Investment background very high-risk, operators invest on risk products and frequently use techniques such as short selling. Moreover, the performance of these funds is much higher than the investment funds c
Fundamentals : Economic data for a country or economic zone.
Front office : People belonging to the front office are those that operate directly on the financial markets in the trading rooms.
Future : Agreement which allows the purchaser to have a certain amount of a given product at a date given but at a price set in the contract signing.

G

G8 : The eight major industrialized countries, including: Canada, France, USA, UK, Germany, Italy, Japan and Russia.
Gap : Trading Hole possibly occur between the close of one session and the opening of the next session.
H

Bearish Harami : Figure bougiste announcing a fall, it is important if a bullish candle followed by a small bearish candle included in the first.
Bullish Harami : Figure bougiste announcing an increase, it is important is a bearish candle followed by a small bullish candle included in the first.
Hedge fund : particular investment fund, subject to little supervision and rules, use alternative strategies to operate in the markets.
Hedging : Coverage Method of opening a position by buying and selling on the same pair.
Hyperinflation : Use for inflation above 100%
I

Economic indicator : Statistics issued by a country on its economic health, such as GDP or the unemployment rate.
Technical indicator : sensible technical analysis tool help the trader in his choice of positions
Consumer Price Index : Economic indicator measuring the price of a basket of goods and commercial services to the final consumer. It is a leading indicator of inflation.
Interventionism : doctrine that the state can easily act directly in the economy including business nationalization near bankruptcy.

L

Libor interbank interest rate for transactions between banks.
Liquidity : Indicates the volume of transactions in an market. A market is called “liquid” if a large volume of positions is processed.
Long : Jargon designating taking a long position.
Lot : capital made ​​available to the trader to take positions format, standard lot: 100 000 basic units, mini lot: 10 000 basic units, micro lot: 1000 base units.
M
MACD (moving average convergence divergence) : Technical Indicator belonging to the family of trend-following indicators using moving averages.
Major : these 7 major currency pairs are: the euro, the dollar, the Swiss franc, the pound stirling, Canadian dollar, Australian dollar, and the yen.
Efficient Market : Market where each player knows all the information available.
Volatile market : Market where one can observe fast movement shown by strong interest from buyers and sellers.
Margin : Minimum capital required to cover potential losses caused by adverse price movements.
Market maker : Broker that offers courses and is prepared to buy or sell at the agreed price.
Hammer : Figure of bullish reversal, the hammer consists of a small body and a large lower shadow, it lies in a hollow.
Middle office : Organization within financial institutions designed to make the connection between back office and front office, it also deals with risk management.
Momentum : Family indicator for assessing the rate of progression of courses.
Money management : literally money management, money management is to determine how much to invest in each position.
Moving Average : Technical Indicator statistical origin, it can determine the direction of a trend and the relevant entry points using various methods.
NOT

NFP (non farm payroll) : Economic indicator representing the number of lost or gained-farm employment. This statistic strong impact on the markets.
No dealing desk : Execution where each order is immediately executed on the interbank market. Banks in competitions allow you to enjoy low spreads but not fixed.
O
Obligation : Value representing a part of the debt of a company, state or local authorities. They are characterized by an interest payment in return for a loan from the investor.
Oco order : One cancel other, “one cancels the other.” Ie the execution of an order immediately imply the cancellation of the second.
Option : Financial instrument designed to hedge or speculate in buying or selling a price to underlying fixed in advance.
Overnight : Refers to a position that is kept after 21h.

P

Exotic pairs : pairs illiquid and less traded.
Hangman : Figure bougiste bearish, it is composed of a single candle located in the top, with a small body and a big lower shadow.
Pips : The smallest possible variation on exchange rates, variable depending on the context. For example it is 0.01 on USD / JPY and 0.0001 on EUR / USD.
Points and Figures : special representation method course, it has the feature does not consider the time.
Pivot Points : These are levels on which courses tend to bounce, so these are levels of support / resistance. Their calculation formula is relatively simple.
Structured Product : Financial Montage to mix safety and performance. The product includes part-risk (action, …) and a safety part (bonds often).
Pull back : Technical Event corresponding to a return on a straight course after his break.
R

Range : Setting in which prices move so bounded by a higher and a lower.
Recession : Period during which growth is negative.
Revaluation : Increase in currency exchange rates by a central bank.
Relative strength index : technical indicator belonging to the family of oscillators with an overbought zone and oversold he warns potential reversals.
Resistance : horizontal levels where prices tend to bounce under his touch.
Fibonacci retracements : Levels of potential rebounds courses, they are represented by the following levels: 23.6% 31.2% 50% 61.8% 76.4%
Risk management : risk management, it is to determine the risk per trade to be incurred and the maximum total risk on his capital.
Rollover or swap : When a position is kept for several days, it is closed, open all night, the swap. It enables credit or debit the difference in interest rates seen in the day.
S

Scalping : overly aggressive trading method of carrying out trades for very short periods in the order of the second or minute. Using the massively leverage scalper must perform a multitude of trades per day.
Short : term for a short position, example: if you sell euro you will be short euro.
Slippage : During difference between that which the investor would be executed and when it to actually executed. Often due to variation spread.
Underlying : Financial assets which can carry an option or futures contract.
Speculation : Buy or sell a security to earn capital gains.
Forex spot : Refers to the interbank market, ie transactions with immediate delivery.
Spread : The difference between the ask and bid.
Stagflation : Refers to a bad economic situation combining low growth and high inflation.
Stochastic : technical indicator developed by George Lane, it belongs to the family of oscillators, it highlights an area overbought and oversold and trends in signals with its signal curve.
Stop out : minimum required level to maintain open positions below this threshold positions are automatically closed.
Trailing Stop : This is a stop order which changes proportionally to the increase in prices.
Stoploss : predefined level by the trader to automatically exit a losing position.
Straddle : Strategy used on options, it is to buy simultaneously a call and a put on the same dates of exercise. The goal is to win without knowing the direction that will take the course, however, requires that the movement is strong, otherwise it remains pe
Support : horizontal levels where prices tend to bounce above on contact.
Overbought : used to refer to an increase too sharply or too quickly the market.
Overselling : Term used to describe falling too far or too fast the market.
Swing trading : trading method of carrying out trades in trend following several days to see several weeks.
T

Takeprofit : predefined level by the trader to automatically out of a winning position.
Head And Shoulders : Figure Chartist bearish reversal. It formed two highest (shoulders) of the same height above surrounding a (head) of greater size. Indicates a decrease in the break of the neck line.
Head and shoulders reversed : Figure Chartist of bullish reversal. It formed two lowest (shoulders) of the same height surrounding a lower (head) of greater size. Reports an increase in the break of the neck line.
Tick ​​: Minimal Change to rising or falling.
Automated Trading : Using a computer program for the entire management of trader positions.
Discretionary Trading : the most widespread trading style, of leaving the trader free practice all operations on his positions, though it is dangerous, the trader must learn to control his emotions make informed decisions.
Trading semiautomatic : Using a computer program used to provide decisive information to the person. However the trader manages itself its positions.
Ascending triangle : Figure Chartist consists of a horizontal resistance and a bullish oblique support, courses oscillate between these terminals, if the resistance is broken then it is a bullish signal
Descending triangle : Figure Chartist consists of a horizontal support and a downward sloping resistance, classes range between these bounds, if the support is broken then it is a bearish signal
Symmetrical triangle : Figure Chartist consists of two straight opposite directions containing the courses. The meaning of the output indicates that the courts have a high probability of continuing in this direction.
Three black crows : After three bearish candles whose bodies are relatively high. Indicates a bearish signal.
Three white soldiers : Following three bullish candles whose bodies are relatively high. Indicates a bullish signal.
V

Volatility : Measures the amount of variation of price of a financial asset.

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