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Trader's Dictionary

Ask - the purchase price. In the currency quotation it is indicated on the right. For example, in the GBP / USD 1.5771 / 1.5773 quote, the purchase price is 1.5773. At this price, the trader can buy the base currency for the quote currency, in this case 1 British pound for 1.5773 US dollars.


Base (base) currency; Base currency is the first currency in the currency quotation. For example, in the GBP / USD quote, the base currency is the British pound sterling. For many quotes, the base currency is the US dollar.


Bai; Buy - opening a deal to buy.


Bar graph; Bar chart - a way of displaying the price movement, in which each price segment is represented as a bar (Bar), which has in its visual representation of the opening and closing prices, the minimum and maximum price for the period.


Bid  - selling price. In the currency quotation it is indicated on the left. For example, in the GBP / USD 1.5771 / 1.5773 quote, the selling price is 1.5771. At this price, the trader can sell the base currency for the quote currency, in this case 1 British pound for 1.5771 US dollars.


Broker - an intermediary (organization or private person), which provides a meeting of buyers and sellers in the market. To be able to make transactions in the Forex market, you need to select a broker that meets the necessary criteria, and open a trading account with him.


Bull market - a situation on the market when steady growth is clearly visible.


Currency quotes (counter currency); Counter currency is the second currency in the currency quote. For example, in the GBP / USD quote, the quote currency is US dollar.


Intraday trading; Day trading; Intraday - making deals during a trading session without transferring open positions to the next trading day.


Volatility (variability); Volatility is a characteristic of the market, denoting a measure of price movement over a certain period of time. Increased market volatility is often observed at the time of release of data on important economic indicators.


Graphic figures are various graphical analysis figures constructed using lines. Graphic figures make it easier to understand the market situation and help predict further price movements.


Gap - a gap in the price chart. A gap can occur when there are sharp fluctuations in the market, after the release of important economic data, under force majeure circumstances. Often the phenomenon is observed after the weekend, when the closing prices and the opening of trading are significantly different.


Demo account is a demo account with virtual money, on which a novice trader can train, get acquainted with the trading platform and make transactions without the risk of losing capital. Trading on a demo account is practically no different from trading in real money, updating of quotes and charts occurs in real time.


Deposit; Deposit - the amount of funds in the trading account.


Divergence - the discrepancy between the upward price chart and the downward oscillator. Talking about the weakening of the upward trend.


Diversification; Diversification is a risk reduction strategy in which funds are distributed among different financial instruments. With regard to Forex diversification - trading in different currencies that have minimal impact on each othe


A dealing center is a company that provides people with access to trading on the Forex market. Usually, traders can make deals directly from a dealing room equipped with all the necessary software.


Long position - a deal made with the expectation of making money on price increases. Take a long position - make a purchase.


Closed position - a deal with a fixed result, which is no longer affected by market fluctuations. Close position - to perform a reverse operation with the same transaction volume.


Indicator; Indicator is a market analysis tool; transformed and specially processed data, which to a large extent can clarify the situation on the market and help predict further price movements. Superimposed on the price chart in the form of various lines and histograms. There are technical, economic (fundamental) and even psychological indicators.


Channel; Channel - a consistent decrease and increase in the price within the price range limited by two parallel lines. Channels can be descending and ascending as well.


Convergence; Convergence - convergence of the downward price chart and the upward oscillator. Talking about the weakening of the downward trend.


Consolidation; Consolidation - the movement of the market in the lateral direction within a certain price range. This is a price stabilization that occurs after a pronounced directional movement of the market or occurs in the absence of large players.


Short position; Short position - a deal made with the expectation of making money on price reduction. Take a short position - make a sale.


Correction; A pullback is a temporary price movement in the opposite direction from the current trend. It occurs at the moment of overbought or oversold of the currency under study and is associated with a weakening trend.


Quotation; Currency quotation; Quote - market price; expression of the unit of one currency in units of another currency.


Leverage; Leverage - the ratio between the margin to secure the position (margin) and the volume of the transaction. Brokers provide leverage of different sizes to enable the trader to make transactions in amounts that are many times larger than his deposit. However, the risk of loss also increases.


Cross course; Cross-rate - quotes of world currencies that do not contain the US dollar. For example, GBP / JPY.


Liquidity; Liquidity is a market characteristic denoting the speed and ease of executing transactions, including large ones, which will not significantly affect the price movement.


Limit order; Limit order - an order to complete a transaction with a limitation on the maximum purchase price and minimum sale price. For example, when EUR / USD 1.3795 is quoted, an order to buy (Buy limit) can be given at a level below this value. A sell order (Sell limit) is at a level above this value.


Line chart; Line chart - price chart, indicated by a curved line.


Trend line; Trend line is a line built on characteristic lows or highs of price, formed by successive movement of the market in one direction. The trend line is an important psychological level. It helps to find entry and exit points from the market and to track the moments of trend change.


Locked positions - two orders opened in opposite directions for one trading instrument with the same lot on one trading account. As a rule, it is used to fix a floating loss.


Lot; Lot - the unit of measurement of the transaction. The standard lot is 100,000 dollars. In modern trading, micro lots are also popular when trading in micro Forex.


Money management; Capital Management; Money management - competent management of a trade deposit, which includes the correct choice of the lot when trading, the number of simultaneously open transactions, the number of currencies being traded, etc.


Margin; Pledge; Margin - providing a position with a certain amount of funds that a trader is obliged to make for a transaction. In modern trading terminals it is calculated automatically.


Margin Call; Margincall - the situation when trading with leverage, when the remaining funds on the account are not enough to maintain open positions. If the additional funds are not credited to the account, the broker can independently close part of the client’s positions in accordance with the previously announced level.


Market maker; Market maker is a significant participant in the market, which by its transactions can influence the price behavior.


Bear market - a situation in the market when a steady decline in prices is clearly visible.


MetaStock - known program for technical analysis


Meta Trader; MetaTrader is the most popular trading terminal.


The Mechanical Trading System (MTS) is a fully automated trading strategy designed specifically for the possibility of trading without human intervention using modern software. MTS, giving a stable profit - the dream of every trader.


Micro-forex, Mini-forex - trading conditions, under which there is an opportunity to make transactions with a volume of less than a standard lot (micro-lots). For example: 0.3 or 0.1 lot (30,000 or 10,000 units of the base currency).


A non-market quotation is an uncharacteristic quotation for the current market trend that simultaneously fulfills the following conditions: it has a significant price gap with the schedule; it returns to its previous level in a short time; there is no rapid market dynamics preceding it, and there is no yield of important economic indicators.

As a rule, non-market quotes arise as a result of technical failure on the side of the broker or its counterparties and are subsequently removed from the quotes history. In this case, orders processed on a non-market quotation are canceled.


Volume - trading activity on a currency pair for a certain period of time. The increase in volume in the direction of the trend confirms its strength.


Order; Order - an order to complete a transaction: purchase or sale.


Oscillator; Oscillator is a kind of technical indicators that work well with sideways market movements and showing overbought and oversold areas. As a rule, they are displayed in the form of histograms or curve lines and are located below the price chart.


Pending order; Pending order - an order to complete a transaction when a certain price level is reached. By setting a pending order on the desired conditions, the trader may not monitor the situation on the market - the transaction will be completed automatically.


Open position; Open position - a deal with an unfixed result, which can potentially bring profit or loss, depending on the current state of the market.


Overbought; Overbought is a market condition in which prices are too high, and soon they are likely to decline.


Oversold; Oversold - the state of the market in which prices are too low, and soon they are likely to increase.


Floating profit (floating loss) - unrecorded profit or loss on open positions, changing in accordance with the dynamics of current quotes.


Breakthrough; Breakout - price overcoming of significant levels (support / resistance lines, trend lines, etc.)


Profit; Profit - profit for the transaction.


Slip; Slippage - a situation in which the order is executed at a price worse than the stated one. This is possible after the release of important economic data or with sharp jumps in the market, when order execution at a given level is not possible.


Paragraph; Point; Pip - the minimum possible price change. For example, if the quote has changed from 1.3881 to 1.3882, then the price has passed 1 point.


Risk management (risk management); Risk management - the use of mathematical calculation and financial analysis to control and reduce risk when trading on the foreign exchange market.


Requote; Re-Quote - a broker offer of a new price at the moment of order execution. Often occurs during moments of rapid movement in the market and can contribute to obtaining more profit when closing a deal. However, more often the trader in Russia has to deal with dishonest brokers who, with the help of requotes, try to minimize the trader's income and close the position at a price that is less favorable to him. Most often the use of this term is negative color.


Cell; Sell - opening a deal to sell.


Swap; Swap- if a trader leaves an open position the next day, then when it is transferred to a trading account, a certain amount of money known in advance is deducted from it (depending on the chosen currency pair). This operation is called a swap and is associated with the simultaneous purchase and sale of an equal amount of one currency with different valuation dates. Swap is calculated in the trading terminal automatically at 00:00 server time. From Wednesday to Thursday, the swap is charged / deducted in a triple amount, from Friday to Monday - it is considered one day.


Advisor is a program for automated trading, which works independently according to a predetermined algorithm. Works when the terminal is on. Other names: expert, trading robot, mechanical trading system. Every trader wants to have a profitable adviser who will carry out trading operations instead of him and earn.


Spread; Spread - the difference between the purchase price (ask) and the sale price (bid).


Stop-loss; S / L - order, fixing losses. Used to limit the loss of a trader. Stop-loss can be set in advance below the purchase price or above the sale price, and, when it reaches the desired level, it will be automatically executed.


Stop order; Stop order - an order to complete a transaction with the restriction of the minimum purchase price and the maximum sale price. For example, at the EUR / USD 1.3795 quote, an order to buy (buy stop) can be given at a level above this value. A sell order (sell stop) at a level below this value.


Take profit; T / P - order, fixing the profit. Take profit can be set in advance above the purchase price or below the sale price, and, when it reaches the desired level, it will be automatically executed.


Technical analysis; TA; Technical analysis - analysis of market behavior and forecasting price movements based on visual perception of graphs taking into account historical data, using technical tools, building indicators and figures, determining trends, etc. without taking into account economic trends and global events that may significantly affect market behavior. Often technical analysis is opposed to fundamental analysis.


Trading system; Trading strategy; Trade system - a number of rules on the basis of which the trader performs operations in the market. Everyone can develop their own trading system for themselves, as closely as possible to the individual characteristics of the character and attitude to risk.


Trading session; Trade session - working hours of trading platforms located in different geographical areas. The main trading sessions: Asian, European and American.


Trading range; Trade range - the distance between the lowest and the highest price during the trading session, or the distance bounded by two important price levels.


Trading terminal; Trading platform; Trade terminal - specialized software for making transactions in the market in real time. The most common trading terminal today is MetaTrader.


Trader; Trader - a person performing operations in the market.


Trading; Trading - trading in the financial market.


Trailing stop; Trailing stop is a kind of stop-loss, an order for consistent automatic fixation of growing profits in an open position with a favorable price movement. The desired level of restriction is set, and the program moves it independently. Trailing stop is set for an open position and works only when the terminal is on.


Trend; Tendency is a steady and obvious direction of price movement that lasts a certain time. The trend can be upward (upward, up-trend) and downward (downward, down-trend).


Level of support; Support level - a psychologically significant level at which bulk purchases usually begin. The level of support is an important part of technical analysis, it is built on two or more price lows in the form of a straight line.


Resistance level; Resistance level - a psychologically significant level at which mass sales usually begin. The resistance level is an important part of technical analysis, it is built on two or more price highs in the form of a straight line.


Fibonacci - in the Forex market is used in the meaning of the same name tools for analyzing the market, named after the great mathematician Leonardo Fibonacci, who studied the sequence of numbers and derived interesting patterns. The following tools are traditionally used for market analysis: Levels F, Time zones F, Expansion, Channel, Veer, Fibonacci Arcs.


Flat; Flat - lateral price movement within a certain price range; uncertainty in the market when there is no apparent downward trend or price rises.


Forex; Forex is a market for OTC transactions where currency trading is performed.


Fundamental analysis; F; Fundamental analysis - analysis of the economic and political situation in the world and in individual countries, as well as events that may affect the future behavior of the foreign exchange market in order to determine the price movement. Fundamental analysis is often contrasted with technical analysis.


Japanese candles; Forever schedule; Candlestick chart is a special way of displaying the price chart, in which the open (open) and close (close) periods of the period, as well as its maximum (high) and minimum (low) prices are clearly visible. For the convenience of visual perception and quick determination of the tendency of a candle, it is customary to paint in different colors depending on the direction of price movement.