The most common Forex terms:
Forex trading terminology: Have you ever felt like you are in another country and everyone is talking foreign whenever you meet Forex traders and they start throwing the jargon all over the place, they can make you feel out-of-place I know, but do not worry, not anymore, I am here to lend a helping hand teaching you those that I think are the most common Forex terms, they got me so confused as well at some point, I cannot write all of them, but few to get you started, in no particular order they are listed below.
Sellers price or offer price.
An interest that is paid/or earned for holding positions overnight, it is also known as a rollover interest, it can be positive as well when you are holding a buy position of a currency that has a higher bank rate than the one you are selling in a currency pair.
Units traded, like quantity.
When you don’t have enough money left in your account, so the Forex broker automatically closes some or all of your positions and you might end up with (-) balance.
The price level (not exact price but area) where traders tend to sell at and that prevents the price from going above a certain level creating a ceiling and making it difficult for the price to move up.
The price level (not exact price but area) where traders tend to buy at and that prevent the price from falling below this level creating a floor below which the price has difficulty moving.
Buy or buying
Sell or selling
Currency that is quoted first e.g EURUSD (Eur =base currency)
An individual or firm that brings buyers and sellers together.
CFD is short for contracts for difference, they are the derivatives of the index, can be traded as well on the same platform that we use for trading currencies.
Control center of mt4
Trading station/trading platform where all the trading activities take place, it is provided by a broker of your choice.
Takes positions/trades in commodities or currencies and liquidate those within a day.
Difference between the bid or buying price and the ask or selling price for it, every broker attaches the spread to the currencies we trade and that is how the brokers make their profits/money.
A strategy that attempts to make lots of profits on small price changes.
Price action consisting of lower lows.
Period of range activity after a long-term price move.
Quick market move at which the price skip several levels up or down.
When the monetary policymakers are expected to hike the interest rates, we say we expect the news to be hawkish.
Combination of positions that reduces the risk of the primary position.
Unit to measure the amount of dollar.
The small increment of a currency, how we measure our loss or profits.
Indicative market price.
When the price is either going up or down (trading sideways).
The difference between the price that was requested and the price obtained.
Current market price.
Protective measure against major losses, the level at which we are willing to close our trade should it go against us.
The level at which we are setting our targeted profit, you can put a trade, and walk away, it will automatically close when the set target is reached, you do not have to be glued on your screen as if life stops just because you trade.
Very active markets that produce lots of trading opportunities.
The combined price of a group of stocks.
Strengthening of currency.
The weakening of a currency.
Nickname for Swiss franc (CHF)
Nicknames or slang for Us dollar.
Those currencies from the countries whose exports are heavily based on natural resources, like Canadian dollar(oil).
Slang for the Canadian dollar.
Slang for Great Britain Pound.
Consumer price index.
Swiss national bank /central bank of Switzerland.
European central bank for countries using Eur.
Reserve bank of Australia.
Central banks abbreviation.
Bank of Japan.
Bank of England.
Bank of Canada.
As I have mentioned above that I cannot list all of them but few, I hope you enjoyed learning some new terms that can help you understand better whenever you are met with Forex traders, now you can read those newsletters that you are subscribed to without being confused, those listed above are the most used words in Forex trading and there is lot more. Thank you for stopping by, please do share the post using the share buttons below.