Dictionary of the trader for trading on the Forex market

The Forex market – an international financial market where trade or exchange of currencies, commodity assets and shares are carried out.

Quotations – the price of a certain product, instrument, currency pair, which is bought or sold.

Trend – established price direction. There are ascending, descending and lateral trends.

An upward trend (bullish) – a trend aimed at rising prices (to the north) in which mainly purchases (long positions).

Downward trend (bearish) – a trend aimed at reducing prices (to the south) in which mainly sales (short positions).

The lateral trend (flat) – a trend without an expressed direction (horizontal movement) without preferential purchases or sales.

Volatility – the indicator of price change over a period of time and indicates market activity. Characterized as high or low.

Technical analysis – analysis of price quotations based on different approaches regarding the history of trading, using indicators of losses and other methods of technical analysis.

Indicator – a technical analysis tool that is applied to the price chart. Conditionally is divided into trend, oscillators, volume and custom.

Patterns (figures) – a section of technical analysis based on the history and model of movement for certain parameters.

A figure is also called a movement of 100 points.

Fundamental analysis – analysis of indicators of the economies of countries (GDP, inflation rates, employment, etc.), statements of representatives of the Central Bank, presidents, scandals and so on.

The Central Bank (CB) is the fundamental economic body: the Fed, the ECB, the Bank of England, etc ..

The support and resistance levels are important price levels, from which the price hitting is possible. Resistance – the level is located above the current value and acts as a certain limiter in further growth. Support – the level is located under the current value and acts as a certain constraint to further decline.

Psychological level – some round value (1.0000, 1.5000, 60.00) or half-round, on which the market leans.

Gap – the price gap, which is formed on the weekends, important news or high volatility.

Timeframe (time interval) – the time period of the graph, which is displayed with a single candle (bar). The most common timeframes are: M1 – minute; M5; M15; M30; H1 – one hour; H4; D1 – one day; W1 – one week; MN – one month.

Moving Average (MA) – the most common indicator of technical analysis, determining the trend in the financial market.

Fibonacci levels (Fibo.) – an indicator of technical analysis that determines the possible correction or further movement within the Fibonacci numbers.

Correction (rollback) – the price movement directed against the main trend, but not exceeding it.

Major pairs (majors) are currency pairs that contain the US dollar (USD). May be direct and reverse. Direct quotations – determine how much you can get the national currency for the US dollar (EUR / USD; GBP / USD; AUD / USD). Back quotations – determine the amount of the national currency necessary for the purchase of the US dollar (USD / JPY; USD / CAD; USD / CHF).

Cross-rate – quotations that do not contain the US dollar.

Commodity currencies (raw materials) – currencies that largely depend on the dynamics of raw material prices, as they are exporters of this asset (CAD; AUD; NZD; GBP).

Assets of safe harbor (save haven) – these are assets that have the greatest stability, liquidity and are able to bring profit in any state of the global economy. (JPY; CHF; XAU).

Indices – weighted indicators of different groups of assets. There may be stock indices (DOW; DAX; FTSE) or currencies (USD; EUR), as well as indices of other indicators as volatilities.