Forex Glossary

Forex Glossary

It determines where the price closed relative to a specific price range over a chosen time period. It consists of two lines; %K and %D. Prices trading above or below the Channel Lines hint for a reversal. Japanese candlestick bearish continuation pattern.

During the course of a downtrend, the appearance of a long white candlestick is common, as a correction is part of the prevailing trend. Substantial sale of a financial instrument with rapidly declining prices. It is usually characterised by panic amongst traders. In forex, the rollover rate is the interest rate that traders pay or earn when they hold (rollover) a position open overnight. A Japanese Candlestick bullish continuation pattern.

What’s important when trading on leverage is to always keep an eye on your free margin. Your free margin equals your total equity (account size + any unrealized profits/losses), minus your used margin. If your free margin drops to zero, you’ll receive a margin call and all your open trades will be closed at the current market rate. For example, if EUR/USD is currently trading at 1.1558 and rises to 1.1562, that rise would equal to a change of 4 pips.

During the course of an upward move, three long white candles- each opening and closing higher than the previous one, re-establishes the rally. It then forms a small white body. The last candle is a long black body that opens below the previous body- signaling a reversal. A Japanese candlestick pattern signaling bullish reversal. During the course of a downward move, three long black candles- each opening and closing lower than the previous one, re-establishes the decline.

A positive number implies a profitable system whereas a negative number, shows a system that resulted in a loss on average after each trade. on the 45 degrees line shows a market in balance i.e. one unit of price corresponds to one unit of time.

Closing price definition

SEC The Securities and Exchange Commission. Sector A group of securities that operate in a similar industry. Sell Taking a short position in expectation that the market is going to go down.

forex vocabulary

A long white candle drives the market higher, well into the long black candle’s body and more specifically above forex vocabulary its mid-point, indicating a bullish reversal. It is subdivided into 100 avos. It is subdivided into 100 mongo.

forex vocabulary

A position is the expression of a market commitment, or exposure, held by a trader. Profit or loss on a position can only be realized once it has been closed. An open position is a trade that is still able to generate a profit or incur a loss. When a position is closed, all profits and losses are realized, and the trade is no longer active.

forex vocabulary

  • The theory holds that at these levels, (i.e. expansions) significant changes may be expected, for example, the end wave 3.
  • The bearish decline is running out of steam as shown by the presence of the Doji, which signals uncertainty as it is contained by the previous long body.
  • Parabolic moves can be either up or down.
  • Most APs are market makers or large investment houses.
  • In USDJPY, a move from 128.51 to 128.52 is one pip.
  • A technical analysis price pattern, where price action is contained within two upward sloping parallel lines.

Japanese candlestick bullish continuation pattern. During an upward rally, a long white candle is followed by a second long white body that gaps higher in the direction of the prevailing forex vocabulary trend. A third candle, black this time, closes (but does not fill) within the gap. During the course of an uptrend a long white body is followed by a shorter black body that gaps higher.

It is subdivided into 100 satang. The currency of the Syrian Arab Republic.

Once a breakout from the channel takes place, the price is expected to move a distance equal to the width of the channel. The currency of the Democratic Republic of Congo. It forms at the top of an uptrend or near a resistance area.

The BIS often acts as an agent in the forex market, allowing central banks to mask their identity in an attempt to dampen market impact. The concept of short selling currency is different to short selling a stock. Spot currency is always traded in pairs. The concept of going long in trading is relatively straight forward. You simply click the “buy” button and then you enter into a long position.

They are also generally easier to read and interpret. The chart makes it easier to see the relationship between the open and close and the high and low of price movements. They also give a more accurate depiction of market sentiment. A breakaway gap to the downside this time, will end the sideways movement and signal a trend reversal. The price pattern, isolated by the two gaps, is known as Island Reversal.

EUR/USD is trading around 1.0850, above the lowest since April 2017. The US Control Group disappointed by staying flat in January. Consumer sentiment beat expectations. Germany reported a 0% growth in Q4 2019.

Let’s say you bought an asset and the trade does not work out and you start to lose money. As the price keeps going in the opposite direction to your trade, you could in theory lose your entire trading account. A stop loss is an order that will automatically close the trade once it has reached a point that you consider the loss unacceptable. A Japanese candlestick is a method of illustrating the price movement. They tell us a certain amount of information.

If above 0 line – bull, below 0 line – bear. Generate trading signals when divergence between price and RSI, or when RSI is above 70 or below 30 (might consider using or FX).

Realized profit/loss The amount of money you have made or lost when a position has been closed. Resistence level A price that may act as a ceiling. Retail investor An individual investor who trades with money Bitcoin Trading from personal wealth, rather than on behalf of an institution. Retail sales Measures the monthly retail sales of all goods and services sold by retailers based on a sampling of different types and sizes.

Normally associated with good ’til cancelled orders. Open position An active trade with corresponding unrealized P&L, which has not been offset by an equal and opposite deal. Option forex vocabulary A derivative which gives the right, but not the obligation, to buy or sell a product at a specific price before a specified date. Order An instruction to execute a trade.

Exchange definition

SHGA.X Symbol for the Shanghai A index. Short-covering After a decline, traders who earlier went short begin buying back.

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