Terminology
A
Accrual : An accumulation of interest and discounts generated by swaps (arbitrage) trades in forward foreign exchange transactions.
Adjustment：Government action, usually in the form of a change in domestic economic policy in response to a balance of payments imbalance or in adjustment of the national exchange rate.
Analyst: A person who analyzes company data, economic data, or price icons to make recommendations for a deal.
Appreciation: A rise in the price of a currency due to greater market demand is called an Appreciation.
Arbitrage: To buy or sell an investment product and at the same time reverse trade the same number of positions in the relevant market, so as to profit from the small price fluctuations between different markets.
Asian Central Banks: Asian Central Banks is a non-profit monetary and financial institution chartered by public authorities of Asian countries or regions. It has the characteristics of both intergovernmental organizations and non-governmental organizations. It is the central bank of the central Banks of Asian countries and regions.
Asian Session: 23:00 -- 08:00 (Tokyo).
Ask/Offer Price : The Price at which the market is prepared to sell a product. Quote both ways at a "buy/sell" price. Dealer selling price is also called retail buying price. In foreign exchange trading, it means that the trader can buy the base currency at this price, the number on the right of the quote. For example, EUR/ USD is quoted at 1.0762/64, the base currency is euro, and the dealer is selling at 1.0764, meaning you can buy 1 euro for $1.0764.
AUS200: Standard & Poor's 200 Index in Australia.
At Best：An order for a trader to buy at Best or sell at Best.
At or Better：An order to trade At or Better: An order to trade At or Better.
Aussie: Also known as "Oz" or "Ozzie", stands for "Australian dollar/US dollar" currency pair.
B
Balance of trade: the difference between a country's exports and its imports.
Bar chart ：A type of foreign exchange chart having four important components: the maximum and minimum constituting the vertical height and the opening (shown as a dash to the left of the vertical line) and the closing (shown as a dash to the right of the vertical line).
Barrier option: The main function of this option is to automatically form other buy and sell options when the interference occurs, and its financial option standard changes to a very strange degree. Once the price of the senior guaranteed bond reaches a significant level, the barrier to choice becomes quite active or disappears.
Base currency: the preceding currency of a currency pair. A quote is usually expressed as a unit of base currency worth how many other currencies. For example, if USD/CHF=0.9720, that means the dollar (base currency) is worth 0.9720 Swiss francs. In the foreign exchange market, the dollar is usually placed first in a currency pair, serving as a "base currency" for a quote, that is, a quote expressing how much the dollar is worth in other currencies. The exceptions are sterling, the Euro and the Australian dollar (which usually keep the greenback low against the GREENBACK).
Base rate: the base rate is a general reference rate in the financial market. Other interest rates or financial asset prices can be determined according to this base rate.
Basing: a time when the trading price of a stock, such as a stock, has changed little or remains unchanged.
Basis point: A measure used to describe the smallest change in the price of a product.
Bearish/Bear market Bear market/Bear: adverse price movements, downward as a bear market, to market for bears on Wall Street said the pessimists. Bear markets are the opposite of bull markets. It is said that bears' eyes look down when they make a move to attack or attack others, so the bear market is used as a metaphor for falling. For example, "We are bearish on EURO/DOLLAR", which means we think the Euro will move lower against the Dollar.
Bears: A trader who bears a short position and believes that prices will fall.
Bid Price：The Price at which the market is preparing to Bid for a product. Quote both ways at a "buy/sell" price. In foreign exchange trading, the buy price indicates that the trader can sell the base currency at this price, to the left of the currency pair quote. For example: EUR/USD 1.0762/64, base currency is Euro, purchase price is 1.0762, meaning you can sell 1 Euro at $1.0762.
Bid/ask spread: the difference between the buying and selling prices.
Big figure: refers to the first two or three figures of foreign exchange quotation. For example, if the bid/offer quote for USD/JPY is 120.06/08, then 120 is a large number. Similarly, EUR/USD quote 1.0762/64, 1.07 is a large number. Since the bulk of the exchange rate is usually less volatile, traders tend to omit verbal quotes. The EUR/USD quote is 1.0762/64, normally read orally as "62/64".
Bank for International Settlements (BIS) : A consortium of the central Banks of Britain, France, Germany, Italy, Belgium and Japan, together with JP Morgan, representing the interests of the Banking Industry in the United States, and Citigroup, New York and Chicago, established in May 1930 in accordance with the Hague Convention and headquartered in Basel, Switzerland. It is an international organization dedicated to international monetary and fiscal policy cooperation. It is composed of central banks of more than 50 countries.
Black box Black box: refers to design good trading strategy in advance, then compiled into a computer program, using a computer to perform the brain of trading strategies, this strategy is based on previous price movement rule, chart patterns or signal or fundamentals or reports and the motion law and summarized, it can be a tendency to follow patterns, can also be a reverse trend model, or other such as cycle trading pattern, determine the timing of the trade order, price and quantity, etc.
Blow off:A rapid rise in prices followed by a fall in the bubble head: the equivalent of a capitulation sell-off followed by a rise. That is, the short throws in the towel and closes the remaining short position.
BOC: Central Bank of Canada.
BOE: The Central Bank of England.
BOJ: Bank of Japan.
Bollinger Bands : A tool used by technical analysts. This channel draws two standard deviations on each side of the moving average and is often used to indicate levels of support and resistance.
Bond :A debt investment in which an investor borrows from an entity (company or government) in need of funds at a specified interest rate and for a specified period of time. The investor receives a certificate, called a Bond, which specifies the interest rate (coupon) available to the investor and the date on which the funds will be repaid (maturity).
Book: In a professional trading environment, a bookbook is an overview of all positions at a dealer or trading desk.
British Retail Consortium (BRC) shop price index: an indicator of inflation measured by looking at different retailers. The measure measures only changes in the price of goods bought at retail stores.
Broker: An individual or company that ACTS as a Broker and has relationships with buyers and sellers for the purpose of collecting fees or commissions. Instead, the "trader" trades money and takes a long or short position, hoping to unwind that position later on in a trade with the other party to earn a spread (a profit).
Buck：Market jargon used to refer to a million dollar base currency pairs or dollars as a general term.
Bullish/Bull market Bull market/Bull market: stronger support market and price upward. For example, the phrase 'we are long euro/DOLLAR' implies that we think the euro will rise against the dollar. Investors are bullish on the market, anticipating that prices will rise, so they buy when prices are low and sell when they rise to a certain level, in order to obtain the difference. In general, people usually call a market that has a long uptrend a bull/bull market. A bull market is characterized by a series of sharp rises and small falls.
Bulls: Traders who take long positions in the expectation that prices will go up.
Bundesbank: The central bank of Germany.
Buy : Also called "long", it means to Buy a currency, or long.
Buy Dips: Wait for a pullback trend with 20-30 points of upside. This is a phase Buy.
C
Cable pound/DOLLAR: Trade term for pound/dollar. It is called "Cable" because exchange rates were first transmitted over The Atlantic Cable in the mid-19th century.
CAD Canadian dollar: also called Loonie or Funds.
Call option: a currency trade that seeks interest rate differentials between two countries. Traders gain interest rate differentials between the two countries during the duration of the trade by selling a low-yielding currency and buying a high-yielding one.
Canadian Ivey Purchasing Managers (CIPM) Index: A monthly index of Canadian business sentiment published by Richard Ivey Business School.
Candlestick chart :A chart indicating the trading range and opening and closing prices of the day. If the opening price is higher than the closing price, the rectangle between the opening and closing prices is solid. If the closing price is higher than the opening price, the chart area is hollow.
Capitulation: At the end of an extreme event, a trader who has a loss closes out his position. This often signals that an expected reversal is coming soon.
Carry trade: A trading strategy in which you go long one relatively high-yielding currency and short another relatively low-yielding one to earn the spread between them. For example: The New Zealand dollar/yen was a famous carry trade for some time. The New Zealand dollar is a high-yielding currency, while the Japanese yen yields are lower. Traders who want to take advantage of this spread will buy the NZD and sell the yen, or be long THE NZD/Yen. If the NZD/JPY downward trend lasts longer, it is most likely due to changes in interest rates, at which point the carry trade is known as "unwinding".
Cash market: The actual underlying market on which a derivative contract is based.
Cash price: the price of a product for immediate delivery, that is, the price of the product at that moment.
CBs: Short for central bank
Central bank: A government or quasi-governmental organization that manages the country's monetary policy. For example, the Central bank of the United States is the Federal Reserve Bank, and the German Central Bank is the Bundesbank.
CFDs: A derivative that shows the change in the value of an underlying asset, such as an index or a share. It allows the trader to leverage his capital (by trading much more than the nominal principal of his account) and to offer the trader the full product benefit without actually owning the securities trading product. In practice, if you buy a CONTRACT for difference for $10 and sell it for $11, you will get a dollar spread. Conversely, if you short the trade and sell it for $10 and then buy it back for $11, you pay the difference of $1.
Chartist: A tist USES charts, graphs and historical data to find price trends and forecast future trends.
Choppy Choppy Choppy: Limited follow-through, short term price action not conducive to aggressive trading.
Cleared funds: money that can be used to clear a transaction at any time.
Clearing: The process of Clearing a transaction.
Closed position: Exposure to financial contracts, such as currencies, no longer exists. To close a position by offsetting an open position with an inverse equal trade. Once closed, the position is "closed."
Closing:The process of Closing an existing trade by performing the exact opposite of the opening trade.
Closing price: The price at which a position is closed. Also referred to as the price of the last transaction of the day.
Collateral: An asset given for the purpose of Collateral loan or Collateral performance.
Commission: A fee charged for buying or selling products.
Commodity currencies: Currency of an economy whose exports are heavily dependent on natural resources; It often refers specifically to the currencies of Canada, New Zealand, Australia, and Russia.
Components: Dollar currency pairs (for example: Euro/dollar Components are dollar/euro + dollar/Yen). To establish a cross-trade position by alternately selling dollar currency pairs through component selling.
COMPX: for the NASDAQ Composite index.
Confirmation: An exchange document between two parties to a transaction which sets out the terms of the transaction.
Consolidation: a period of volatility in the price after a period of time.
Construction spending:The Census Bureau of the Commerce Department releases monthly data to measure new Construction spending.
Contagion: A tendency in which an economic crisis in one market spreads to other markets.
Contract: Standard unit for foreign exchange transactions.
Contract note:A letter of confirmation sent outlining the exact details of the transaction.
Contract size: The nominal amount embodied in a Contract for Difference.
Controlled risk A condition in which the risk is limited by a guaranteed stop loss.
Convergence of MAs: A technical observation that describes Convergence of moving averages over different periods of time, usually as an indication of price consolidation.
Counterparty: A party to a financial transaction.Country risk: the risk associated with a transnational transaction, including but not limited to legal or political circumstances.
CPI: A measure of inflation. Short for Consumer Price Index.Markets are poised for a steep sell-off.
Cross (e.g. Yen Cross) : currency pairs which do not include the us dollar.
Crown currencies: Canadian, Australian, British and New Zealand dollars (all of which are currencies of the Commonwealth of Nations).Commodity Trading advisors a trader who ACTS like a short-term hedge fund, usually a Chicago-based trader or a futures oriented trader.Any form of money issued by a government or central bank as legal tender or as a benchmark for transactions.Currency Pair: Two currencies that make up a foreign exchange rate. For example, EUR/USD (euro /US dollar).Currency Risk: The Risk arising from adverse changes in the exchange rate.Currency: A symbol consisting of three letters representing a particular Currency, such as USD.Current Account: Total balance of trade (exports of goods and services less imports), net factor income (such as interest and dividends) and net transfer payments (such as foreign aid funds). Among them, total trade balance is the core element of current account.
CTAs：Commodity Trading Advisors, investment type traders who act like short-term hedge funds, usually chicago-based or futures oriented traders. Commodity Trading advisors a trader who ACTS like a short-term hedge fund, usually a Chicago-based trader or a futures oriented trader.
Currency:Any form of money issued by a government or central bank as legal tender or as a benchmark for transactions.
Currency Pair :The two currencies that make up the exchange rate. For example, EUR/USD (euro /US dollar).
Currency Risk:The risk of adverse changes in exchange rates.
Currency symbols :A symbol consisting of three letters representing a particular currency, such as USD.
Current Account:Total balance of trade (exports of goods and services less imports), net factor income (such as interest and dividends) and net transfer payments (such as foreign aid). Among them, total trade balance is the core element of current account.
D
Day Trader :A speculative trader in a commodity market who generally closes his positions for profit on the same day.
Day trading :Open and close a position in the same product within one day.
Deal:A term used to indicate that a transaction is closed at the current market price. For real-time trading, contrary to order.
Dealer:A person or company acting as a party or banker to a transaction. The banker, as a party to the position, gains from the spread (profit) by clearing the other party's trading position. In contrast, brokers are intermediaries or intermediary companies that make money by earning commissions or transaction fees from traders.
Dealing spread:The difference between the buying and selling prices of a contract.
Defend a level :The action taken by a trader or group of traders to prevent a product from trading in a certain price or price area, usually because they have a vested interest in it, such as a barrier option.
Deficit:In short, spending is greater than income.
Delisting :Shares listed on the exchange were delisted.
Delivery :Parties to a foreign exchange transaction actually exchange currencies according to a contract.
Delta:The ratio between a change in the price of a product and the change in the underlying market price.
Department of Communities and Local Government (DCLG):The monthly SURVEY, published by the DCLG, USES a vast amount of data on homes sold to monitor price movements in the UK property market.
Depreciation:A drop in the price of money caused by market forces.
Derivative :A contract whose value changes as the price of a related or underlying stock, futures, or other investment vehicle changes. Options are the most common type of derivative.
Devaluation:The deliberate lowering of the price of a country's currency, usually by a government.
Discount Rate:The interest paid to the central bank by qualified depository institutions by borrowing directly from the central bank for short-term loans.
Divergence:In technical analysis, a situation in which the direction of price moves in the opposite direction of momentum, such as prices rising and momentum falling. Deviation can be divided into positive deviation (ox deviation) and negative deviation (bear deviation). Both divergences mark changes in price direction. The positive/negative divergence occurs when the stock market price reaches a new low and the momentum indicator begins to climb. Negative/bear divergence occurs when stock market prices move out of new highs, but indicators fail to follow suit and instead fall. Deviations frequently occur when price movements are overdone and often end up with prices going into reverse and following momentum indicators.
Divergence of MAs:A technical observation of moving averages moving away from each other over different periods of time, usually predicting price trends.
Dividend:The amount of a company's earnings distributed to shareholders, usually expressed as the value per share.
DJIA or Dow:The Dow Jones Industrial Average or the US 30 for short.
Dove:A dovish, as opposed to a hawk, refers to data or policy views that suggest looser monetary policy or lower interest rates.
DXY$Y:Represents the DOLLAR index
European Central Bank (ECB) : the Central Bank of the new European Union.
Economic Indicators: Data released by governments or authorities that indicate the current pace and stability of Economic growth. Common economic data include employment, gross domestic product, inflation, retail sales and so on.
End Of Day Order (EOD) : An Order to buy or sell currency pairs at a certain price. It is valid for the day before the market is closed (generally 5 p.m. Est).
EST/EDT: New York time zone, representing EASTERN Standard Time/Eastern daytime Time.
ESTX50: A term for the Euronext 50 index.
EURO: The currency of the EURO zone.
European Monetary Union (EMU) : A combination of policies designed to regulate economic and fiscal policies among European Union member states.
European Session European session: 07:00-16:00 (London time)
Eurozone Labor Cost Index: An annualized inflation Index that monitors the compensation and returns earned by local workers is seen as the main driver of overall inflation.
Eurozone Organization for Economic Co-operation and Development (OECD) Leading Indicator：Indicators published monthly by the Organisation for Economic Co-operation and Development (OECD). It measures the overall state of a country's economy by combining ten leading indicators: average working hours per week, new orders, consumer expectations, building permits, share prices and spreads.
EX-dividend: a form of stock purchase in which the purchaser gives up the next dividend and returns the interest to the seller.
Expiry date/price: the exact date and time at which the option will expire. The two most common options expire at 10:00 AM ET (also known as 10:00 New York time or New York time) and 3:00 PM Tokyo time (also known as 15:00 Tokyo time or Tokyo time). As a result of the spot market hedging liquidation, these periods often appear the increase in market activity.
Exporters: companies that sell goods around the world and which in turn make them sellers of foreign currency as well as buyers of their own currency. The term is often used to refer to large Japanese companies such as Sony and Toyota as natural sellers of dollars/yen in exchange for dollars earned from sales of goods around the world.
Extended: Market moves are considered too rapid and quick.
F
Factory Orders: The total value of durable and non-durable goods Orders, expressed in U.S. dollars. Deeper than its monthly orders for durable goods published earlier than it does.
Fair value: The difference between the price of a derivative contract and the spot market price of the underlying commodity. Fair value means there is no arbitrage between the two prices.
Fed: Refers to the Federal Reserve Bank of the United States, the U.S. Central bank, or the Federal Open Market Committee.
Fed officials: a member of the Federal Reserve Board of the United States or the President of the regional Federal Reserve Banks.
Figure/The Figure: Refers to The "00" numeric portion of a quote such as 00-03 (1.2600-03), which can be read as "Figure 3". If someone is selling for 1.2600, the trader may call it "The Figure was given" or "the figure was hit".
Fill: The situation in which an order is fully executed.
1. If we cannot complete the transaction, we will Fill or kill the order.
First In First Out (FIFO) : All open positions are closed on a "First In First Out" basis. That is, for a currency pair of all open positions, according to the order to open positions, the first held positions first closed positions, positions held after closing positions.
Fix: An operation in which a large amount of foreign currency must be bought or sold to execute a commercial customer's order. There are about five fixed orders in a foreign exchange session. Normally, these fixes cause associated market volatility. The usual time is as follows (all New York time) :
5:00 AM -- Frankfurt
At 6:00 am, London
10:00am -- WMHCO World Markets Trading Company
11:00AM -- WMHCO, more important
8:20AM -- IMM (World Money Market)
8:15AM -- ECB (European Central Bank)
Flat or Flat Reading: The economic reading is consistent with the previous period, with no change.
Flat/square: Foreign exchange term for a position that has been settled with all counter trades. For example, if you buy $500,000 and then sell $500,000, the current position is closed.
Follow-through: The appearance of a new buy or sell interest following a breakthrough in the direction of a particular price level. A lack of follow-through generally means that the directional trend will not last or will reverse.
FOMC: The Federal Reserve Open Market Committee, the policy-setting committee of the Federal Reserve.
Foreign Exchange (FOREx, FX), for short, forex or FX, is the practice of buying one currency and selling another.
Forward: A transaction in which both parties establish the exchange rate in advance and establish a contract for future delivery at maturity based on the spread of the currency being traded.
Forward Points: Points to be added or subtracted from the current exchange rate in order to calculate the Forward rate.
FRA40: Name of an index of the 40 largest listed companies (market capitalisation) on the French Stock Exchange. The FRA40 is also known as the CAC 40.
FTSE 100: UK 100 index
Fundamental Analysis: Fundamental Analysis of economic and policy aspects to discern the future price trends of an investment.
Funds: A type of hedge fund that is active in the market; It is also another industry term for us/Canadian dollar currency pairs.
Future: A contract between two parties to execute a transaction at a specified time in the Future at a price agreed to today.
Futures Contract: A standard Contract whereby both parties agree to take delivery of a commodity or investment product at an agreed price at a certain time in the future. The basic difference between futures and forward transactions is that futures are generally traded on a futures exchange (exchange-traded contracts, or ETC), while forward transactions are over-the-counter (OTC). Over-the-counter (OTC) trading refers to any trading that takes place outside an exchange.
G
G7:The G7 is the group of seven industrialized countries, namely, the United States, Germany, Japan, France, Britain, Canada and Italy.
G8: Group of seven plus Russia.
Gap/Gapping: There's been a sharp move in the market, with prices jumping multiple levels without any trading. Short jumps often occur after economic data or news releases.
Gearing (also known as leverage or Margin) : The Gearing ratio refers to the fact that the notional principal of a trade exceeds the amount of money held in a trader's account. Expressed as a percentage or fraction.
GER30: An index of the 30 largest listed companies on the German Stock Exchange, another name for the DAX index.
Given: Acceptance of the offer or interest in the offer.
Giving it up: The level of skill has been lost in battle.
GMT: The time zone of Greenwich Mean Time, the most common reference in the foreign exchange market. In contrast to daylight saving time/daylight saving time, GMT remains unchanged throughout the year.
Going Long: The act of buying stocks, futures, or currencies for investment or speculation purposes.
Going Short: The act of selling a currency, security, or other investment product without owning it.
Gold's relationship: It is generally believed that Gold is moving in the opposite direction to the DOLLAR. The long-term correlation coefficient is negative most of the time, but is less reliable than the short-term correlation.
Gold Certificate: property right Certificate used by Gold investors to buy or sell Gold. It is characterized by: no Gold COINS are cast, no Gold COINS are circulated, but paper certificates are actually circulated.
Gold Contract:The standard unit for a Gold Contract is a Gold Contract. One gold contract = 10 Troy ounces.
Good for day: An order which, if not closed, becomes void at the end of the day.
Good 'Til Cancelled Order (GTC) : An Order for which the transaction price has been specified will remain valid until the transaction is completed or Cancelled.
Good 'til Date: A type of order that expires if a transaction is not completed by a selected date.
Greenback: A nickname for a dollar.
Gross Domestic Product: The total value of goods and services produced by all economic activity within a country, whether Domestic or foreign-owned. GDP, a measure of how fast a country's economy is growing (or shrinking), is seen as the most macro indicator of economic output and growth.
Gross National Product (GNP) : The total value of goods and services produced in a given period by all the citizens of a country.
Guaranteed Order: a type of order that protects a trader from a market crash and guarantees that an order will be settled at a preset price.
Guaranteed stop: a stop loss order that guarantees the liquidation of a position at a specified level when the market price reaches or exceeds the level specified by you. This order type guarantees a stop-loss even in the event of a market sell-off.
Gunning, gunned: An investor who pushes to trigger a known stop or technical level of the market.
H
Handle: every 100 points in a foreign exchange market starting from 000.
Hawk - Hawkish: When monetary policy makers think a rate hike is needed, they will be known as "hawks". Interest rates should normally be raised to fight inflation, or to hawkish, or both.
Hedge: Also called a Hedge, one or more positions established to reduce the risk of holding a position.
"Hit the bid" : a promise to sell or buy at the arrived ask or buy price.
HK50 / HKHI: Hang Seng Index in Hong Kong.
I
Illiquid: Very little volume. Lack of liquidity often leads to a volatile market environment.
IMM International Money Market: The International money Market, the Chicago-based currency Futures Market, is part of the Chicago Mercantile Exchange.
IMM Futures (IMM) : Traditional futures contracts based on major currencies versus the U.S. dollar. IMM futures are traded on the Chicago Mercantile Exchange.
IMM Session (IMM) : 8:00 AM - 3:00 PM New York time.
INDU: Short for Dow Jones Industrial Average.
Industrial Production: Measures the real output of manufacturing, mining, and utilities on the basis of quantity, not amount. Very sensitive to economic development or contraction, it is a leading indicator of employment and income.
Inflation: An economic pattern in which prices rise and the purchasing power of consumers declines.
Initial Margin: Money deposited as security for the purpose of establishing a position.
IPO: A private company's initial public offering of stock, short for initial public offering.
Interbank Rates: Exchange quotations between large transnational Banks.
Interest: A cash adjustment reflecting the effect of a notional asset value owed or received under a position in contracts for difference.
Intervention: The action of the central government to intervene in the market to right or left the currency price. Joint intervention refers to the action of several central Banks to control the exchange rate jointly.
Introducing Broker
INX: Stands for the S&P 500
ISM Manufacturing Index: An Index that evaluates the state of the Manufacturing sector in the United States. It measures the overall state of the Manufacturing sector through surveys of future production conditions, new orders, inventories, employment and deliveries. The value is divided by 50, with above 50 indicating expansion and below 50 indicating contraction.
ISM non-manufacturing: A survey of the outlook for the service sector, which accounts for 80% of the U.S. economy, outside of the Manufacturing index. The value is also divided by 50, with above 50 indicating expansion and below 50 indicating contraction.
J
The Japanese Economy Watchers Survey is a measure of confidence in direct service industries such as waiters, drivers and beauticians. A reading above 50 indicates a good reading.
Japanese Machine Tool Orders: The total value of new Orders placed by the Machine Tool manufacturer. Machine tool order is a measure of machine manufacturing demand is also a leading indicator to grasp the future industrial production status. A strong performance means manufacturing is doing well and the economy is expanding.
JPN225: the nikkei.
K
Keep the powder dry: Restrict trading in harsh trading conditions. Whether turbulent or tight, it is best to stay on the sidelines until there is a clear market opportunity.
Kiwi: Nickname for the New Zealand dollar.
Knock-ins: An option strategy that requires the underlying product to trade at a certain level before the purchased option becomes effective. The knock-in option is used to reduce the additional cost of the underlying option. Once the option becomes effective, the hedging behavior can be triggered.
Knock-outs: An option that nullifies a previous call when the underlying product is traded at a certain level. Once traded at the touchdown level, the underlying option no longer exists and the hedge may have to be unwound.
L
Last dealing day: The Last date on which a particular product can be traded.
Last Dealing time: The Last time you can trade for a particular product.
Leading Indicators: Data used to predict future economic activity.
Level: A price area and special price that is technically significant or based on reported order/option interest.
Leverage: Also known as margin, Leverage refers to the growth of the traded amount relative to the amount you have, which is expressed as a percentage or score. It allows a trader to trade far more than the nominal principal of all his actual capital. For example, a 100:1 leverage means that your tradable notional principal is 100 times the amount in your account.
Leveraged Names: Short-term traders, mostly referring to hedge fund groups.
Liability: Potential loss, Liability or financial Liability.
LIBOR: The London Interbank Offered Rate, the rate at which Banks lend to each other.
Limit Order: If you want to trade a currency pair at a better price than the current one (asking price is higher than the current one, buying price is lower than the current one), you can do this by setting a stop order. For example, if the current USD/JPY exchange rate is 120.28/30, then the blocking order can be set to buy USD/JPY below 120 (e.g. 119.50).
Liquid market: A market where there are sufficient buyers and sellers to allow for smooth price movements.
Liquidition:An order to buy or sell at the current price.An order to buy or sell at the current price. the act of closing out a position by reverse trading with an equal amount of open position.
Liquidity: The ability to accept large transactions in a market without affecting or minimizing price stability.
London Session: 08:00 -- 17:00 (London)
Long position: A position in which prices rise in value. When buying the base currency of a currency pair, the position held is a long position.
Longs: A trader who buys a product.
Loonie: Dollar/Canadian dollar industry slang.
Lot: A unit representing the amount of a transaction. Random change in the value of transactions.
M
Macro: The most long-term trader who makes trading decisions based on fundamental analysis. A "macro" trader can hold positions for six months to many years.
Manufacturing Production: The total output value of the Manufacturing sector in industrial Production. Only 13 sub-areas of output directly related to manufacturing were measured. Manufacturing accounts for about 80 per cent of industrial production.
Margin: Money that an investor deposits at a trader as security for a position.
Margin Call: When the exchange rate moves in the opposite direction and the Margin deposited becomes impossible to maintain the open position, the broker or trader issues a cover Call to the investor, requiring the investor to maintain a certain Margin in order to maintain the open position.
Market Markets: The total Market capitalization of a listed company, equal to the stock price multiplied by the number of shares issued.
Market Maker: Colloquially, a trader who holds an inventory of financial products with the commitment to maintain a two-way trade in those products.
Market orde:An order to buy or sell at the current price.
Market Risk: The Risk caused by changes in Market prices.
Mark-to-market: Valuation method that reevaluates the value of all open positions based on current Market prices. The adjusted value will determine the amount of margin required.
Maturity: the date of delivery or Maturity of a financial product.
Medley Report: Medley Global Advisors, a market consulting firm with close ties to central Banks and government officials around the world. Because they claim to have inside information from policymakers, their reports often cause currency markets to wobble. The accuracy of reports has been erratic for a long time, but in the short term the market will keep an eye on them.
Models: The same as a black box. A system for automatic trading based on technical analysis or other quantitative calculations.
MoM: Abbreviation for monthly growth rate, indicating the change in monthly level from month to month for several consecutive months.
Momentum: A series of technical studies that assess the rate of price change (e.g., RSI, MACD, random indicators, and kinetic energy lines).
Momentum Players: A trader who follows an intraday trend and tries to capture a 50-100 point gain.
N
NAS100: A name for the Nasdaq 100 Index.
Net Position: The value of a long Position held minus a short Position.
New York Session: 8:00 AM - 5:00 PM (New York time).
No Touch: An option that pays the holder a fixed amount if the market does not hit a predetermined barrier level.
Nya.x: Represents the NYSE composite index.
O
Offer (also known as the Ask price) : The price at which a product is sold on the market. Make a buy/sell quote in both directions. Dealer selling price is also known as retail buying price. The bid price represents the price at which the trader buys the currency against the base currency on the right. For example, in a usd/Swiss Franc quote of 0.9720/23, the base currency is THE US dollar and the buy price is 0.9723, indicating that you can buy the US dollar at 0.9723 Swiss francs.
Offered:Sell market: If a market is called a "sell", it suggests a currency pair is attracting strong selling interest or lots of selling.
Offsetting transaction: in order to offset some or all of the position of market risk and trading positions.
On top:I intend to sell it at the current market order price.
One Cancels the Other Order (OCO) : When two orders are placed simultaneously, the Other Cancels automatically when One is closed.
One Touch: An option that pays the holder a fixed amount if the market hits a pre-set barrier level.
Open Order: An order that is not closed until the price reaches a specified target price. It is usually set to "Valid until cancelled".
Overnight Position: A Position held until the next trading day.
Option: A financial derivative that gives the trader the right, but not the obligation, to buy or sell a product at a specified price by a specified date.
Order:An Order that requires a transaction at a particular price.
Order Book: A system that shows the market capacity of traders willing to buy and sell at prices that are not currently optimal.
Over the counter (OTC) : Any trade done outside of an exchange.
Overnight position: A position held until the next trading day.
P
Paid: Refers to the seller of market transactions.
Pair: The foreign exchange jargon for comparing one currency with another.
Paneled:A rather aggressive selling of a Paneled.
Parabolic: The market saw huge moves in a very short period of time, accelerating in a similar semi-parabolic fashion. A parabola can go up or down.
Partial fill: A situation where only a Partial transaction is executed.
Patient: Wait for certain levels before taking a position, or for certain news events to affect the market.
Personal Income: Refers to the total annual Income received by an individual, including salary, bonus and investment earnings. It is a key determinant of personal spending, which accounts for two-thirds of GDP in the leading industrial countries.
Pips: The smallest unit of foreign exchange trading. Usually the fourth after the decimal point. For example, 0.0001 is called point 1.
Political Risk: The Risk caused by policy changes that will have a negative effect on investment.
Portfolio: A group of investments held by an entity.
Position: Net total Position in a currency.
Premium:In foreign exchange markets, when the forward rate is higher than the spot rate, it is called a Premium.
Price Transparency: Transparency in which quotation prices are so transparent that every participant in the market gets a fair Price.
Profit: The difference between the cost price and the selling price when the selling price exceeds the cost price.
Pullback: the tendency of a trend market to Pullback a portion of its advance before continuing in the same direction.
Purchasing Managers' Index: An economic indicator of the performance of a domestic manufacturing company.
Purchasing Managers' Index Services:Markit (France, Germany, Eurozone, UK) : An Index that measures the outlook for Purchasing Managers in the service sector. The survey covered employment, production, new orders, supplier deliveries and inventory status. The cut-off point is 50, above which indicates that the economy is expanding, while below 50 indicates that the economy is contracting.
Put option: A product that the holder has the right but is not obligated to sell at a specific price.
R
Rally: A period of decline followed by a Rally in exchange rates. Range:The difference between the highest and lowest price of a forex or futures trade within a specified period of time.
Rate: the price of one currency in another, usually used for trading purposes.
RBA: Reserve Bank of Australia, the Reserve Bank of Australia.
RBNZ: Reserve Bank of New Zealand, the Central bank of New Zealand.
Real money investors: large-scale traders, including pension funds, asset managers, insurance companies, etc. They are seen as long-term indicators of interest in key markets, as opposed to shorter-term day speculators.
Realized profit/loss: the amount of money gained or lost after closing the position.
Resistance level:Price that ACTS as a peak, as opposed to a support level.
Retail investor: An individual investor who trades with personal property funds rather than on behalf of an institution.
Retal Sales:The total amount of all the goods and services sold in the month shall be sampled and surveyed by retailers of different types and scales. It can reflect the consumption expenditure of a country and is also an important indicator for all major economic countries to measure the economic development.
Revaluation: Trend of rising exchange rate of a currency caused by intervention of central bank. As opposed to devaluation.
Rights issue: A corporate action in which shareholders have the right to buy more shares through Rights issues. The general intention of the company to increase capital will be a rights issue.
Risk: Refers to the Risk arising from uncertainty, most of which occurs when the situation is in the opposite direction.
Risk Management: The application of technical analysis or trading techniques to reduce and/or avoid various risks.
Rol-over overnight interest: Interest earned or paid on a position held beyond the 17:00 New York closing time. It reflects the spread between two currencies in a currency pair. Spot foreign exchange market generally in 2 trading days after delivery. If the position is open on Monday, the delivery date is Wednesday. However, if a position opened on Monday is held overnight, the delivery date will change to Thursday. There is one exception: If you open a position on Wednesday and hold it overnight, the delivery date should be On Saturday, but because the bank is closed on Saturday, the delivery date should be postponed to the following Monday, so that you can open the position and hold it overnight on Wednesday and earn two more days of interest. Similarly, if the delivery date is a holiday, additional interest will be generated or earned accordingly.
Round trip: To buy something or to sell something.
Running profit/loss: an indicator reflecting the position status of open position; That is, the unrealized money that you can gain or lose by closing all open positions at the current point in time.
RUT: The Russell 2000 index
S
SEC: U.S. Securities and Exchange Commission
Sector: a group of similar sectors.
Sell:Establish a short position in anticipation of a market decline.
Settlement Settlement: the reverse action of a transaction. The settlement of foreign exchange transactions sometimes requires the actual exchange of two currencies, and sometimes does not.
SHGA.X: stands for Shanghai A-share Index.
Short Position: A Position that profits from a fall in the exchange rate. When the base currency of a currency pair is sold, it is called a "short position".
Short squeezers: Traders place heavy bets against the market and the market catalyst causes them to scramble to cover (buy), leading to a sharp rise in prices.
Short-covering: Traders who have been shorting stocks during a downturn start buying them back.
Shorts: A trader who has sold or shorted a product, or who is bearish on the market.
Sidelines: A disoriented, chaotic and uncertain market environment forces traders to stay out of the market. This situation is referred to as "Sidelines" or "hold on to money."
Simple Moving Average (SMA) : A line connecting all the averages of prices over a given period of time. For example, the SMA over the 50 days of the daily chart refers to the average closing price over the last 50 days. You can apply any time interval here.
Slippage: The difference between the requested price and the received price, usually due to changes in market conditions.
Slippery market: an industry term used to describe a market that seems to be poised for rapid movement in a certain direction.
Sloppy market weakness: Lack of any significant trend and/or persistent volatile trading environment.
SNB: Swiss Bank, the Swiss National Bank.
Sovereign names: Central bank active in the spot market.
Spot Market: Trading in foreign exchange or commodity futures for cash at the current Market price.
Spot Price: Current market Price. Spot transactions are generally settled within 2 working days.
Spot Trade: The act of buying or selling foreign exchange or commodity futures for immediate delivery (as opposed to futures). Spot contracts are generally electronic contracts.
Spread: The number of points between the purchase price and the sale price.
Square closing: The act of closing a open position by buying and selling.
SPX500: A name for the Standard & Poor's Index.
Sterling: Another name for the pound.
Stock Exchange: A market for trading securities.
Stock index: Composite price of a group of stocks used to assess the group's performance relative to past performance, expressed as a reference point.
Stop loss hunting: A level at which the market appears to be invading and is thought to be rife with stops. If a stop is triggered, a large number of stop orders are triggered, so prices often break above these levels.
Stop Order:A Stop Order that automatically executes a buy or sell when the market price reaches a preset price. When the market price reaches the order price, a stop-loss order will become a market order and will be executed at the most favorable and tradable price in the market at that time. Keep in mind that if the market is not trading at the price of the order, a stop loss order may be executed outside the price set by the order due to a market jump or slip. A stop-loss order will be placed at the next most favorable and actionable level in the market after the order price is triggered.
Stop Loss Entry: A buy order set above the current price or a sell order set below the current price. This order can be used if you think the market will move in one direction and want to enter at a certain price.
Stop loss Order: This is an order set to sell below the current price (to close a long position) or buy above the current price (to close a short position). Stop-loss orders are an important risk management tool. If the market moves against you, you can limit your possible losses by setting stop-loss orders for your open position. Keep in mind that a stop loss order does not guarantee the execution price of the order. When a stop loss order is triggered, the order will be executed at the most favorable and viable price in the market.
Stops building: Refers to the construction of stop-loss orders; Multiple stop-loss orders allow traders to buy above current prices on the upside and sell below current prices on the downside.
Strike Price: The price at which an option owner can buy or sell a product.
Support:A price that ACTS as a basis for past or future price movements.
Support levels:A technical analysis term used to describe a peak or base price on which exchange rates are automatically corrected. Contrary to resistance level.
Suspended Trading: Suspended trading of products.
Swap:The act of buying and selling the same amount of currency at the forward rate.
Swissy: Another name for the Swiss franc.
T
T/P: "gain" order, a limit order in which you wish to sell above or buy back below the asking price.
Takeover: To take control of a company by buying shares of the company.
Technical Analysis: The act of analysing market data to predict future price movements. These market data include: historical trend, average price, trading volume, etc.
Technicians US Bureau of Labor Statistics or Techs
Ten (10) yr.10: For example, the United States 10-year Treasury note, issued by the United States government, can repay its debt in Ten years.
Thin:On Thin, a liquid or unstable market condition. A low volume market that leads to an unstable trading environment.
Thirty(30)yr.:For example, the British government issues a 30-year gilt, which is debt that can be paid back in 30 years.
Tick: the smallest unit of price fluctuation.
Time to Maturity: the Time remaining before a contract matures.
Tokyo Session: 09:00 -- 18:00 (Tokyo time)
Tomorrow (Tom/Next) : Money bought and sold on the same day for delivery on the following day.
Trade Balance: The difference between the import and export of goods or services. Countries with trade surpluses (ie, those with more exports than imports), such as Japan, tend to see their currencies rise. By contrast, countries with trade deficits (more imports than exports), such as The United States, tend to devalue.
Trade size: The number of products per contract or Trade.
Trading bid: Currency pairs perform strongly and/or to the upside, with a steady flow of buying.
Trading halt: A delay in Trading that does not halt Trading.
Trading heavy: A market that appears to be on the way out is often associated with a selling market that does not rebound despite an attempt to buy.
Trading offered: Currency pair weakness and/or weakness, continued selling in the market.
Trading range: The interval between the highest and lowest share prices, usually over a certain period of time. For example, a 52-week trading range.
Trailing stop: Tracking a stop allows a trade to continue to profit during favorable price movements, but automatically uncovers all trades if the market price suddenly moves a certain distance in the opposite direction. Setting up a conditional order does not necessarily limit your losses.
Transaction Cost: the Cost of buying or selling a financial product.
Transaction Date: Transaction Date.
Trend: A price Trend that leads to a net change in value. Upward trends are identified by higher highs and lower highs. The downward trend is defined by lower highs and lower lows.
Turnover: Total amount of all transactions conducted over a period of time.
Two-way Price: refers to the Price offered at the same time as the buying Price and the selling Price.
TYO10: Symbol for the Chicago Board Options Exchange's 10-year Treasury yield index.
U
Ugly: Describe a market situation that can be harsh or harsh.
UK100: A name for the FTSE 200 index
UK average earnings including bonus/ Excluding bonus : a measure of the average salary of laborers. At the same level as the same quarter last year.
UK claimant count rate:Claimant count rate: Measures the number of people who claim unemployment benefits. Because not all unemployed people are eligible for unemployment benefits, the number of claims is often lower than the unemployment rate.
UK HBOS House Price Index, which measures the relative level of UK House prices, is an important indicator of the outlook for the UK property sector and the economy. The index, published by HBOS, Britain's biggest mortgage lender, is the longest monthly index of property prices in the UK.
UK Claims Change: A measure of the change in claims for unemployment benefits last month.
UK Manual Unit Wage Costs: The total cost of Labour per Unit of output.
UK OIL: A name for Brent crude OIL.
UK Producers Price Index Input: A measure of the level of Price inflation at which Producers buy goods or services. It is worth watching closely because it is a leading indicator of the level of inflation.
UK Producers Price Index: A measure of the level of Price inflation at which Producers sell goods and services.
Underlying：The precise market where the price of a product is traded.
Unemployment Rate: The ratio of workers to the total number of unemployed.
University of Michigan's Consumer Sentiment Index: Data based on a survey of 500 U.S. domestic consumers. The index is published twice a month: first in the middle and last at the end. The questions revolve around individual attitudes towards the US economy. It is seen as an important indicator of the level of consumer spending.
Unrealized Gain/Loss: the theoretical profit and Loss of the open position calculated at the current market price shall be calculated by the dealer. Unrealized profit and loss only becomes actual profit and loss after closing the position and settlement.
Uptick: The price quoted is higher than the previous price.
Uptick Rule: An American trading Rule that states that a short sale cannot be made at a price lower than the best offer at the time.
US30: A term for the Dow Jones Industrial Average.
US OIL: A name for WTI crude OIL.
US Prime Rate: The Rate at which US Banks lend to Prime corporate customers.
V
Value Date: the Date on which both parties in a financial transaction agree to settle their respective interests, such as exchange fees. The delivery date of foreign exchange spot transaction is generally two working days after the transaction. Also known as "expiration date".
Variation Margin: The Margin required by the broker from the customer. Generally refers to the reverse price fluctuations and the need for customers to deposit additional funds.
VIX/Volatility Index is a measure of expected market Volatility over The next 30 days. It USES the volatility of the S&P 500 index. It is widely used to measure market risk and is often seen as an "investor panic indicator".
Volatility (Vol) : The ratio of price fluctuations over time.
W
Wedge Chart Pattern: it refers to a gradually shrinking Chart Pattern in the shape of a "Wedge". In a rising Wedge, the high price keeps decreasing, while in a declining Wedge, the low price keeps decreasing. An upward wedge usually follows a decline, and a downward wedge usually follows a rise.
Whipsaw: Refers to a highly volatile market, which rises and falls sharply and then reverses quickly.
Wholesale Prices: A measure of the change in the price a retailer has to pay for a finished product. It can reflect inflationary pressures earlier than the retail sales figures.
Working order: a limit order that has been set but not yet closed.
WSJ: On behalf of the Wall Street Journal.