Forex Glossary

A Japanese candlestick pattern signaling a reversal. It consists of three candles. In a downtrend, a long black candle is followed by a Doji that gaps lower. A third candle, with a long white body gaps above the Doji’s high.

The lowest point a trader’s balance reaches below the Initial Deposit.

History of performed trades on a specific account on the MT4 platform.

A technical Indicator developed by Mark Chaikin. When the close price is above the mid-point of the daily range, then a positive number is returned implying buying pressure (accumulation). Similarly, when the close price is below the mid-point of the range, then a negative number is returned implying a selling pressure (distribution). The daily volume is multiplied by the above number to determine the weight of the price in the calculation of the indicator. Calculation: [ (close – low) – (high – close) x volume] / (high – low)

In Elliott Wave Theory, there are waves that move in the direction of the trend of one larger degree.

A technical Indicator developed by Perry Kaufman to account for market volatility.

See AMD.

Argentine Peso. The currency of Argentina. It is subdivided into 100 centavos.

See AWG.

A technical analysis price pattern, where price action is contained within two upward sloping parallel lines. The basic line is drawn through the bottoms, whereas the return line is drawn through the tops.

An upward sloping line connecting two or more bottoms.

Trading activity between 11:00 pm (GMT+2) and 08:00 am (GMT+2).

A feature of trading platforms that allow the testing of expert advisors on historical data. The results help traders and developers to assess the performance of their strategies.

See BSD.

See BHD.

The amount of money in the account, excluding credit and the floating profit of currently open orders.

See PAB.

Convertible Mark. The currency of Bosnia and Herzegovina. It is subdivided into 100 fenings (or phenigs).

See. BDT.

Average outstanding loans provided to Japanese residents and businesses by domestic banks. Released monthly by the Bank of Japan.

A Bank of Central Banks, based in Basel Switzerland. It facilitates collaboration among its members and serves Central Banks in their pursuit for global monetary and financial stability.

The rate at which a country's central bank lends money to its domestic banks.

The major US Banks are examined under a number of conditions such as global recession and high unemployment, to assess whether they will be able to lend to households and businesses under three scenarios: severely adverse, adverse, and baseline. Released by the Federal Reserve.

Boliviano. The currency of Bolivia (Plurinational State of). It is subdivided into 100 cents (or centavos).

See VEF.

See BOB.

A technical indicator developed by John Bollinger. The upper band is drawn 2 standard deviations above a simple moving average and the lower band 2 standard deviations below the simple moving average. Bollinger Bands measure volatility and display price extremes.

A debt instrument, where the issuer borrows money from the buyer, with the obligation to repay the principal and predefined interest at the maturity date.

The annual interest divided by the value the bond was purchased.

See BAM.

See BWP.

A significant low on the price chart where buying pressure overcomes selling pressure.

A five-candle bearish reversal formation. The first candle is a long white body trading in the direction of the uptrend, showing the bulls’ strength. The second candle is white, and of a regular size gapping above-reaffirming the upward move. The third and fourth candles are white bodies of regular size, higher than the previous close. Finally, a long black body is formed that closes in the gap created by the first two candlesticks.

A five-candle bullish reversal formation. The first candle is a long black body trading in the direction of the decline, showing off the bears’ strength. The second candle is black, and of a regular size gapping below-reaffirming the downward move. The third and fourth candles are black bodies of regular size, closing lower than the previous close. Finally, a long white body is formed that closes in the gap created by the first two candlesticks.

It is the nickname used for the currency pair of GBPUSD. It is also used to refer to the British pound itself. Communication between Europe and North America was conducted through a transatlantic cable in the Atlantic Ocean.

Canadian Dollar. The currency of Canada. It is subdivided into 100 cents.

It gives a trader the right to buy a financial instrument at a specific price, before the expiration date.

It is a calculation method that yields 4 resistance and support levels. It is used in pivot point level calculations. It makes use of the High, Low and Close price of the previous day. R4 = Close + (High – Low) * 1.1 / 2 R3 = Close + (High – Low) * 1.1 / 4 R2 = Close + (High – Low) * 1.1 / 6 R1 = Close + (High – Low) * 1.1 / 12 PP = (High + Low + Close) /3 S1 = Close - (High – Low) * 1.1 / 12 S2= Close - (High – Low) * 1.1 / 6 S3 = Close - (High – Low) * 1.1 / 4 S4 = Close - (High – Low) * 1.1 / 2

A price charting method that originated in Japan in the 18th century. Merchants devised a system to predict future prices based on traders’ emotions. It makes use of all available prices; open, high, low and close. It consists of a rectangle (the body) which is white if the close is higher than the open, or black if the open is higher than the close price. A vertical line runs through the body representing the high at the top and the low price at the bottom.

A monthly report that shows the percentage of a country’s resources used by manufacturers, mines and utilities. A high reading is positive for the country’s currency whereas a low reading is negative. Released by the Federal Reserve.

Money used to acquire, improve or upgrade physical assets such as buildings, infrastructure, and equipment.

The appreciation in the value of capital assets.

The result of selling a capital asset at a lower price than the purchased price.

See COP.

See Commodity Exchange.

An amount the trader is charged by the broker for facilitating a trade.

*The US Commodity Futures Trading Commission was created in 1974 with the aim of fostering open, transparent, competitive, and financially sound markets. By working to avoid systemic risk, the Commission aims to protect market users and their funds, consumers and the public from fraud, manipulation and abusive practices related to derivatives and other products that are subject to the Commodity Exchange Act (CEA).

A natural resource or agricultural product. There are two broad types - hard commodities and soft commodities. Hard commodities include for example crude oil, gold, silver and iron ore. Soft commodities include for example wheat, rice, soybean and corn.

A country’s currency that is highly correlated with the price of a specific commodity.

A technical analysis oscillator developed by Donald Lambert. It compares the current typical price ([High + Low + Close] / 3) with a simple moving average over a selected period of time usually 14 or 20. The oscillator values are normalized by using a divisor based on mean deviation. The majority of the values (about 70%) fluctuate between -100 and +100. Buying opportunities are suggested above +100 and selling opportunities below -100 while the same levels may be considered as overbought and oversold by others.

It is a leading market for trading metals. Part of CME Group.

A graph that illustrates the intraday movements of a financial instrument.

See GMD.

See DKK.

A Japanese candlestick pattern signaling a bearish reversal. It forms at the top of an uptrend or near a resistance area. During the course of an upward movement, a long black candlestick closes below the midpoint of the previous long white candle. The black candle opens above the previous high.

Part of the MT4 Client Terminal interface. It displays information about a selected bar/candlestick. By simply placing the arrow on the desired bar/candle, the window will display the OHLC prices, the open time and date, volume and the corresponding values of any attached indicators/oscillators.

Deutscher Aktien Index (German Stock Index) is an index of 30 large German company shares.

A trade opened and closed within one day.

Failure to fulfil debt obligations.

See STD.

A Japanese candlestick formation that has equal (or almost equal) opening and closing price. It signals indecision.

A Japanese candlestick pattern. In a downward movement, a Doji gaps below a long black candle but fails to move substantially lower as it closes where it opened. It has possible bullish implications.

See DOP.

A technical analysis tool developed by Richard Donchian. It plots the highest high and lowest low of the last n candlesticks. It is used to measure volatility and identify support and resistance levels.

See VND.

Dominican Peso. The currency of the Dominican Republic. It is subdivided into 100 centavos.

A technical analysis reversal price pattern. After an established downtrend, the last bottom fails to move lower than the previous bottom and prices rise above the last top.

See Expert Advisor.

See European Central Bank.

A broker who uses Electronic Communications Networks (ECNs) to provide its clients with direct access to liquidity providers.

Monthly survey of consumers’ confidence that indicates the trend of the European economy. A positive reading is good for the Euro. Released by the European Commission.

EMH holds that all traders have access to news and information at the same time. As a result, the charts ‘price in' all news and information. Prices fluctuate around intrinsic values and any overbought or oversold movements do not last long enough so one can benefit from them. The EMH assumes that the best strategy is to buy and hold.

Egyptian Pound. The currency of Egypt. It is subdivided into 100 piastres and 1000 millimes.

See EGP.

Technical Analysis theory developed by Ralph Nelson Elliott. Financial Markets follow a form of 5 waves. Three impulse waves (1, 3 and 5) in the direction of the trend and two corrective waves (2 and 4) in the opposite direction. One complete cycle is made up of 8 waves.

Monthly survey of manufacturers in New York State. Participants are asked to report changes on a variety of economic indicators- from the previous month and six months ahead. A reading above zero is good for the currency where a reading below zero is negative. Released by the Federal Reserve Bank of New York

Monthly report of current month’s employment numbers compared to the previous month. An increase of employed people is good for the currency where a decrease is negative.

Ethiopian Birr. The currency of Ethiopia. It is subdivided into 100 santims.

See ETB.

Euro. The currency of the eurozone. It is subdivided into 100 cents.

See EUR.

The ECB was established in 1998, located in Frankfurt (Germany), to manage the euro, keep prices stable and conduct EU economic & monetary policy. Its main aim is to keep prices stable, thereby supporting economic growth and job creation.

The European Union member states that adopted euro as their currency.

A Japanese candlestick pattern signaling a bearish reversal. A long white candlestick forms in the direction of the prevailing trend, signifying that the upward movement is still in force. The next session gaps above, forming a small candle, in this case a Doji that acts as an obstacle to further rise. A long black candle drives the market lower, well into the long white candle’s body and more specifically, below its mid-point -Indicating a bearish reversal.

A Japanese candlestick pattern signaling a bearish reversal. A long white candlestick forms in the direction of the prevailing trend, signifying that the upward movement is still in force. Next session gaps above, forming a small candle that acts as an obstacle to further rise. A long black candle drives the market lower, well into the long white candle’s body and more specifically, below its mid-point-Indicating a bearish reversal.

A type of Order execution available on MT5. Orders placed on the MT5 are sent to an exchange (i.e. liquidity provider) to be executed at current market offers.

The rate at which one currency can be exchanged for another.

A monthly survey showing orders for immediate or future delivery, placed with manufacturers. It provides an indication of future business trends. Released by the Census Bureau.

A reversal pattern. During the course of an uptrend as defined by successively higher tops and higher bottoms, the last top fails to exceed the previous top and prices fall below the last bottom. This is a failure swing to go short. On the other hand, in the course of a downtrend, as defined by successively lower tops and lower bottoms, the last bottom fails to move lower than the previous bottom and prices rise above the last top. This is a failure swing to go long.

The current price at which an asset could be sold on the open market.

See FKP.

A Japanese candlestick continuation pattern. During a downtrend, a long black body is followed by three small candlesticks, formed between the previous candle’s range - triggering a pause in the market. The resumption of the downtrend is signaled by the presence of the fifth candle which is a long black body.

See Federal Reserve.

Report submitted semiannually to Congress containing discussions of "the conduct of monetary policy and economic developments and prospects for the future”, along with testimony from the Federal Reserve Board Chair.

See FOMC.

It is the central bank of the United States. It was established in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system.

Continuation price pattern composed of a parallelogram with slanting sides against the trend and preceded by an almost straight-line move called a flagpole. The flagpole and the breakout of the parallelogram are accompanied by heavy volume. The flag pattern causes a brief pause in the market that lasts less than 3 weeks.

Precedes the parallelogram part of the flag pattern. It’s an almost straight-line move (accompanied by heavy volume) called a flagpole. Projecting the flagpole at the breakout point, a price target may be calculated.

An a-b-c correction against the prevailing trend. It follows a 3-3-5 wave pattern.

When an exchange rate is not fixed, but adjusts depending on the supply and demand for a particular currency relative to other currencies.

It is responsible for conducting the nations (USA) monetary policy.

The FOMC (Federal Open Market Committee) Chair presents the current economic/monetary projections and provides additional context for the FOMC's policy decisions during a press briefing. It’s scheduled four times per year.

An FOMC tool to control inflation and short-term interest rates. Scheduled eight times per year. It is the interest rate at which banks and other depository institutions lend money to each other. Released by the Federal Reserve.

Minutes of the most recent meeting giving insights of the future of the US interest rate. Released eight times per year by the Federal Reserve.

Scheduled four times per year. During the conference the FOMC Statement is read and the Fed’s Chair answers press questions regarding the monetary policy. High market volatility is usually expected.

A group of 20 countries represented at the highest level by heads of state/government and at the ministerial level by ministers of finance and central banks governors. They meet to discuss global and economic issues. The group consists of the following countries: Argentina, Australia, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, South Africa, Saudi Arabia, South Korea, Turkey, United Kingdom, United States of America, The European Union (represented by the European Council).

A technical analysis tool developed by W. D. Gann. To draw a Gann Grid, attach the tool at an initial point on the chart. A second point is needed to set the cell grid size. The resultant Grid consist of multiple lines at 45 degrees angle. On the Gann Grid, there are three control points. By moving the first and the last points, the size of the grid cell may be set/modified. The middle point is used to move the Gann Grid on the chart keeping the dimensions intact. Gann considered the 45 degrees line as the most important in representing long-term trendlines. Based on Gann’s theory, prices: above the ascending 45 degrees line indicate an uptrend. Further acceleration of the upward movement may find resistance at the higher 45 degrees lines. below the ascending line. imply possible change in trend direction. Further fall of the prices may find support at the lower 45 degrees lines. below the descending 45 degrees line, indicate a downtrend. Further fall of the prices may find support at the lower 45 degrees lines. above the descending line, imply a possible change in trend direction. Further rise of the upward movement may find resistance at the higher 45 degrees lines.

Unused area on the price chart between two candlesticks. It may occur at Monday’s open or during high impact or unexpected news.

It’s a technical analysis oscillator developed by Bill Williams. It consists of two histograms, above and below zero. The histogram above the zero line shoes the difference between the teeth (red line) and the jaw (blue line) of the Alligator. The histogram below the zero line show the difference between the lips (green line) and the teeth (red line) of the Alligator. A histogram bar is colored green when the value is greater than the previous bar’s value and in red color when the value is less than the previous bar’s value. The Gator Oscillator helps to understand what the Alligator does: Sleeps - Both bars are red Eats – Both bars are green Awakes – After sleeping, one bar is green and one bar is red Fills out – After eating, one of the bars is red

Pound Sterling. The currency of United Kingdom of Great Britain and Northern Ireland, Guernsey, Isle of Man, Jersey. It is subdivided into 100 pence.

Gross domestic product (GDP) is the total value of goods and services a country produces in a one year period. GDP is calculated annually but it can also be calculated quarterly. A GDP Economic report that shows the annualized change in total value of goods and services produced in a country and is an indicator of a country’s economic health.

Dalasi. The currency of the Gambia. It is subdivided into 100 bututs.

Guinea Franc. The currency of Guinea.

To buy a financial instrument with the expectation that it will rise in price.

To sell a financial instrument with the expectation that it will decline in price.

See XAU.

See GTC.

Before the continuation patterns of flags and pennants are formed, a steep and rapid price movement -a pole, is always present. After a pause in the market that takes the form of a flag or a pennant, a breakout occurs out of the pattern in the same direction as the pole. The measuring implication is equal to the length of the pole, hence half-mast.

The Halifax House Price Index measures the change in the house prices throughout the UK. It is released monthly as an annualized change. The change is calculated as an average for the latest three months compared with the same period, a year earlier. It is released by the Halifax Bank of Scotland.

A Japanese candlestick pattern signaling a bullish reversal. The presence of a hammer at the end of a downtrend or decline, alerts for a possible bullish reversal. Traders enter the market with short positions, pushing prices even lower in the direction of the prevailing trend, to form the lower shadow. Eventually, the downward move is proven short-lived, as bulls take over the control and manage to close the session at the upper area of the candle. This forms the real body, whose length is 2-3 times shorter than the lower shadow.

See HSI.

The presence of a Hanging Man at the end of an uptrend or upward move, alerts for a possible bearish reversal. Traders enter the market with short positions, pushing prices lower against the direction of the prevailing trend, to form a long lower shadow. Eventually, the bulls take over the control and manage to pull the session higher at the upper area of the candle. This forms a small real body, whose length is 2-3 times shorter than the lower shadow.

A Japanese candlestick pattern signaling a bearish reversal. A small candlestick body of either color follows a candlestick of a long white body. The color of the small candlestick is not important. The bullish move is running out of steam as shown by the presence of the small candle which signals uncertainty, as it is contained by the previous long body. The weakness of the market to push prices higher and the presence of the pattern at the end of an upward move, signals possible bearish implications.

A Japanese candlestick pattern signaling a bullish reversal. A small candlestick body of either color follows a candlestick of a long black body. The color of the small candlestick is not important. The bearish decline is running out of steam as shown by the presence of the small candle which signals uncertainty, as it is contained by the previous long body. The weakness of the market to push prices lower and the presence of the pattern at the end of a decline, signals possible bullish implications.

A Japanese candlestick pattern signaling a bearish reversal. Just like Harami, a small candlestick body- (Doji in this case) follows a candlestick of a long white body. The bullish move 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. The weakness of the bullish market to push prices higher and the presence of the pattern at the end of an upward move, signals possible bearish implications.

A Japanese candlestick pattern signaling a bullish reversal. Just like Harami, a small candlestick body- (Doji in this case) follows a candlestick of a long black body. 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. The weakness of the bearish market to push prices lower and the presence of the pattern at the end of a decline, signals possible bullish implications.

In Time Cycles, the principle of Harmonicity states that two neighboring cycles are related by a small whole number- usually the number 2. For example, if a 20-day cycle exists then the shorter cycle will be a 10-day cycle where the longer one will be a 40-day cycle.

It refers to the tone of language that policy makers use when referring to inflation. For example, a hawkish statement implies that drastic measures may be taken to raise interest rates.

A Technical Analysis price pattern signaling a bearish reversal. It consists of three tops and two bottoms. The highest top is known as the Head where the top to the left is known as the Left Shoulder and the top to the right is known as the Right Shoulder. The line connecting the two bottoms is known as the neckline. A prerequisite of any reversal is the existence of a trend, an uptrend in this case. In the course of an uptrend, as defined by consecutive higher tops and higher bottoms, the presence of a lower top warns for a potential reversal. A decisive break of the neckline signals the end of the prevailing uptrend and the beginning of a downtrend. If volume is available, then heavy volume should accompany the breakout below the neckline.

Investors use hedging to protect themselves by reducing the risk that may be caused by adverse market movements. Hedging means making two opposing investments, minimizing the losses which could be incurred by price fluctuations.

Investment funds that invest in a wide range of assets to reduce risk.

It is a price charting technique that filters out noise. It uses modified open, high, low and close prices: haClose = (Open + High + Low + Close) / 4 haOpen = (Previous haOpen + Previous haClose) /2 haHigh = Max(High, haOpen, haClose) haLow = Min(Low, haOpen, haClose) Heiken Ashi makes trend identification, retracements and reversals easier: Uptrend is identified as a series of white bodies. Strong Uptrend is defined as a series of long white bodies with and no lower shadows. Downtrend is identified as a series of black bodies. Strong Downtrend is defined as a series of long black bodies and no upper shadows. Weak trends are defined by the presence of smaller bodies. Retracement is defined by the presence of smaller bodies and the presence of upper and/or lower shadows. Reversal is defined by the presence of a Doji or color change.

Automated trading, placing a big number of trades on high volumes and speed.

The highest price that a financial instrument is traded during a specific timeframe.

Historical Data is used in charts, backtesting and Expert Advisors’ Optimization. They are stored in the History Center of the client terminal. Historical Data may be modified in the following ways: - Import. - Export. - Add. - Delete. - Change.

Hong Kong Dollar. The currency of Hong Kong. It is subdivided into 100 cents.

Lempira. The currency of Honduras. It is subdivided into 100 centavos.

A Japanese candlestick pattern signaling a bullish reversal. It forms at the bottom of a downtrend or near a support area. It consists of two black candlesticks. The decline continues to record lower prices as reflected by the presence of a long black candle. Next session is characterized by a smaller black body that is completely engulfed by the previous long black body, signaling weakness, setting the stage for a bullish reversal.

See HKD.

A method used in Point and Figure charts to calculate price targets. It applies to both 1-box and 3-box reversal charts. In horizontal count, the width of the congestion pattern determines the price target.

The annualized number (monthly x 12) of residential “housing units” on which construction has begun in the previous month. Released monthly by the Census Bureau.

Kuna. The currency of Croatia. It is subdivided into 100 lipa.

Hang Seng Index. A stock market index composed of 50 stocks of the largest companies in the Hong Kong Stock Market. It is used to gauge stock market performance.

Gourde. The currency of Haiti. It is subdivided into 100 centimes.

Forint. The currency of Hungary. It is subdivided into 100 filler.

See ISK.

A technical indicator rather than a complete system that is used to identify with “one look” at the chart, the direction of the market, entries (buy and sell) and support and resistance levels.

A Japanese candlestick pattern signaling a bearish reversal. While the market is in an uptrend or near a resistance area, the presence of a long black body signals an alert for traders. The second candle is a long black candle that opens at or near the first candles’ close. Both the second and third candles close lower than the previous candle’s close.

Rupiah. The currency of Indonesia. It is subdivided into 100 sen.

New Israeli Sheqel. The currency of Israel. It is subdivided into 100 agora.

See International Monetary Fund.

In Elliott Wave Theory, these waves move in the direction of the wave of one larger degree. For example, in a complete cycle (8 waves), impulse waves 1, 2 and 3 move in the direction of the wave of one larger degree. Also, the corrective waves a and c move in the direction of the wave of one larger degree.

A Japanese Candlestick pattern signaling bearish continuation. In the course of a downtrend a small white candle opens below the low of the prior long black body and closes just above the prior close.

A Japanese Candlestick pattern signaling bullish continuation. In the course of an uptrend a small black candle opens above the high of the prior long white body and closes just below the prior close.

See INR.

Technical tools based on inductive statistics and mathematical formulas, which use price data, volume and open interest in order to identify future price trends.

Foreign Exchange Rate quoted for 1 unit of the foreign currency. Foreign currency represents the base currency where the domestic currency corresponds to the quote currency. For example if in Europe, the exchange rate between the euro and the dollar would be USDEUR.

A sustained increase in the price of goods and services that reduces the purchasing power of money.

Indian Rupee. The currency of India. It is subdivided into 100 paise.

In bar charting, an inside day is defined as a bar with lower high and higher low compared to the previous bar. It suggests a pause in the market.

The interest rate charged on short-term loans between banks.

The cost of borrowing money, usually expressed as a percentage and calculated on an annualised basis.

A technical analysis methodology that examines the correlations between four major asset classes: stocks, bonds, commodities, and currencies. For example, Stock Market and Treasury Bonds are positively correlated. Whereas Interest Rates are negatively correlated to both markets. Commodities and Bonds usually move in opposite directions. The US Dollar and Gold are also negatively correlated.

In Time Cycles analysis, Intermediate Cycles last from several weeks to several months. Identification of Intermediate Cycles may be performed by measuring the time interval between the cycle’s troughs (lows) on the X-axis of the price chart.

In Dow Theory, an Intermediate Trend is a correction of the Major Trend. It usually lasts 3 weeks to 3 months.

It runs through the price action, connecting internal tops and bottoms rather than extreme lows (uptrend line) or extreme highs (downtrend line).

*The International Monetary Fund, or IMF, promotes international financial stability and monetary cooperation. It also facilitates international trade, promotes employment, sustainable economic growth, and helps to reduce global poverty. The IMF is governed by and accountable to its 189 member countries.

Usually, opening and closing a position within the day.

A Technical Analysis chart pattern signaling a bullish reversal. It consists of three bottoms and their corresponding tops. The lowest bottom is known as the Head, where the bottom to the left is known as the Left Shoulder and the bottom to the right is known as the Right Shoulder. The line connecting the two tops is known as the neckline. A prerequisite of any reversal is the existence of a trend, a downtrend in this case. In the course of a downtrend, as defined by consecutive lower tops and lower bottoms, the presence of a higher bottom warns for a potential reversal. A decisive break of the neckline signals the end of the prevailing downtrend and the beginning of an uptrend.

A Japanese candlestick pattern signaling a bullish reversal. An Inverted Hammer formed at the end of a downtrend or at a support area has bullish reversal implications. Traders enter the market with long positions but eventually the sellers’ pressure overcomes buyers’ pressure and the candlestick closes at the lower area of the inverted hammer. The small body and the absence of a lower shadow reveals the weakness of the bears who are unable to maintain the downward move. The body of the Inverted Hammer is 2-3 times shorter than the upper shadow.

Iraqi Dinar. The currency of Iraq. It is subdivided into 1000 fils.

See IRR.

See IQD.

Iranian Rial. The currency of the Islamic Republic of Iran. It is subdivided into 100 dinar.

Iceland Krona. The currency of Iceland.

Near the end of an uptrend, a final gap known as exhaustion gap will appear on the price chart to alert the end of the trend and the beginning of a brief, narrow sideways movement. 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.

A monthly survey where purchasing managers are asked to rate business activity in the manufacturing sector and more specifically, on production, employment, new orders, prices, supplier deliveries and inventories. A reading above 50 is bullish for the US Dollar, while a reading below 50 is bearish. Released monthly by the Institute of Supply Management.

ISM Non-manufacturing Index based on surveys of non-manufacturing firms' within 60 industry sectors. It helps investors to get better insights into current market conditions. When this index is increasing, the stock markets are generally going up due to potentially increased corporate profits. The index is a composite of four indicators, including seasonally adjusted business activity, employment, supplier deliveries and new orders received. A rule of thumb in terms of interpreting the data is- a reading above 50 percent means the non-manufacturing sector of the economy is expanding and below 50 percent means that it is contracting.

See JMD.

This is the theory that if the stock market ends higher in January, the rest of the year will also end higher. Conversely, if January ends on a low note, stock prices will be lower for the end of the year. According to Yale Hirsch: “As January goes, so goes the rest of the year.”

A charting method that has gained a lot of popularity recently, because the charts are more visually appealing than bar charts that reflect the same information. 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. There are two types of Candlestick; the first Candle has a white or hollow body which indicates that the market is moving upwards, as there is more buying than selling interest. As the Close price is higher than the Open price, the white candlestick depicts the positive sentiment in the market and the fact that bulls are in control. The longer the body is, the stronger the buying interest. A filled (black) body which indicates that the market is moving downwards indicates that there is more selling than buying interest. As the Close price is lower than the Open price, the black candlestick depicts the negative sentiment in the market and the fact that bears are in control. The longer the body is, the stronger the selling interest. The lines above and below the body of the candlestick are called “Shadows” or “Wicks”. The upper shadow reveals the price levels above the body that have been tested but eventually rejected. Similarly, the lower shadow reveals the price levels below the body that have been tested but eventually rejected.

Jamaican Dollar. The currency of Jamaica. It is subdivided into 100 cents.

Jordanian Dinar. The currency of Jordan. It is subdivided into 10 dirham, 100 qirsh or 1000 fulus.

Number of job openings that need to be filled within 30 days. These include full-time, part-time, permanent, short-term and seasonal openings. Released monthly by the Bureau of Labour Statistics.

The currency of Jordan. It is subdivided into 10 dirham, 100 qirsh or 1000 fulus.

Yen. The currency of Japan.

One of the popular cycles in Time Cycle Analysis. Clement Juglar supported that a cycle of approximately 9 years, is presented in many areas of economic activities.

Kondratieff-Cycle. One of the longer cycles in Time Cycle Analysis. Discovered by the Russian Economist Nikolai D. Kondratieff. He supported that a cycle of approximately 54 years is present in prices and many areas of economic activities. Also, known as K Wave.

A price charting technique independent of time. It is plotted as a series of connected vertical lines. The thickness and direction of the lines, reflect the price action: An uptrend is displayed as series of thick vertical lines A downtrend is displayed as series of thin vertical lines A buy signal is generated when price moves above the most recent high whereas a sell signal is in place when it moves below the last low.

A technical analysis indicator developed by Chester Keltner. The upper band is drawn twice the value of the average true range (ATR) calculated over 10 periods above a 20-period exponential moving average of typical prices. The lower band is drawn the same distance below the exponential moving average. A positive signal is generated when price closes above the upper band. Similarly, a close below the lower band indicates a negative signal.

See KES.

Kenyan Shilling. The currency of Kenya. It is subdivided into 100 cents.

Som. The currency of Kyrgyzstan. It is subdivided into 100 tyiyn.

Riel. The currency of Cambodia. It is subdivided into 10 kak or 100 sen.

A Japanese candlestick pattern signaling a bearish reversal. During the course of an uptrend, a long black candle gaps below the previous white Marubozu and then declines lower closing at the low of the session, demonstrating strong bearish power.

A Japanese candlestick pattern signaling a bullish reversal. In the course of a decline, a long white candle gaps above the previous black Marubozu and rallies higher, closing at the high of the session, demonstrating strong bullish power.

One of the popular cycles in Time Cycle Analysis. Discovered by Joseph Kitchin. He supported that a 40-month cycle was present in the stock markets.

It is the nickname of the New Zealand Dollar (NZD). Flightless bird and national symbol of New Zealand.

Comoro Franc. The currency of the Comoros. It is subdivided into 100 centimes.

One of the longer cycles in Time Cycle Analysis. Discovered by the Russian Economist Nikolai D. Kondratieff. He supported that a cycle of approximately 54 years is present in prices and many areas of economic activities. Also, known as K Wave.

North Korean Won. The currency of the Democratic People’s Republic of Korea. It is subdivided into 100 chon.

Won. The currency of the Republic of Korea.

See HRK.

See KWD.

See AOA.

Kuwaiti Dinar. The currency of Kuwait. It is subdivided into 1000 fils.

See MMK.

Cayman Islands Dollar. The currency of the Cayman Islands. It is subdivided into 100 cents.

Tenge. The currency of Kazakhstan. It is subdivided into 100 tiin

It shows the hourly costs of maintaining employees. Released quarterly by Eurostat.

The percentage of population (eligible to work) that is either looking for a job or already has a job. Released monthly by the Bureau of Labour Statistics.

A quarterly report that measures the real gross domestic product per hour worked. Released by Statistics Canada.

A technical indicator that triggers buy and sell signals with a lag.

In the financial markets, latency refers to time units (usually milliseconds) required for a trade order to be sent and executed by the broker’s server.

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. Even though the fourth candle gaps below the previous body, it attempts to extend into the previous candle’s body, as shown by the relatively long upper shadow, but eventually retreats making a new low. It then forms a small black body. The last candle is a long white body that opens above the previous body- signaling a reversal.

A Japanese candlestick pattern signaling bearish reversal. During the course of an upward move, three long white candles- each opening and closing higher than the previous one, re-establishes the rally. Even though the fourth candle gaps above the previous body, it attempts to extend into the previous candle’s body, as shown by the relatively long lower shadow, but eventually retreats making a new high. It then forms a small white body. The last candle is a long black body that opens below the previous body- signaling a reversal.

Lebanese Pound. The currency of Lebanon. It is subdivided into 100 piasters.

A monthly report that shows the performance of the Japanese Economy. Released monthly by the Cabinet Office (Japan).

A Technical Analysis tool used for trend identification for a set of prices under a period of study. It is attached on the chart by selecting the first price representing the beginning of the trend and then dragging the mouse to the second price in the direction of the trend. It consists of three lines: Linear Regression Trendline Upper Channel Line Lower Channel Line The Linear Regression Trendline, is an equilibrium line that is, a straight line run through a set of prices using the statistical technique of best fit (or least squares) for a period under study. The Upper and Lower Lines are parallel to and equidistant from the Trendline. The distance between either Line and the Trendline, represents the maximum close price deviation from the Regression Trendline.

A technical analysis indicator. It is a moving average that assigns more weight to more recent prices. As a result, it is more sensitive to price changes compared to the Simple Moving Average.

The volume available in the market for a specific currency pair.

The Moving Average Convergence/Divergence is a momentum oscillator developed by Gerald Appel. It is the difference between a 12 period and a 26 period Exponential Moving Average plotted usually as a histogram above (difference is positive) or below (difference is negative) the zero line. A 9 period Simple Moving Average of MACD is known as the Signal Line.

This refers to the amount of money needed in your account to maintain an open position

This is a notification which alerts you that you need to deposit more money in your trading account, to ensure that there is sufficient margin to keep existing positions open.

It is the ratio of Equity to Margin used for your open positions and indicated as a percentage. It indicates the “health” of your account.

The value an open position would be if it were closed at the current market rate.

An application store where traders can buy trading indicators, expert advisors, scripts and other applications.

See Depth of Market.

The order will be filled at the next available price.

A technical indicator developed by Dr. Bill Williams to evaluate the efficiency of the price movement. An efficient market is defined as a market when all traders (long-term and short-term) are actively trading. The indicator combines price and volume:

A micro lot is equal to 1,000 units of the base currency in a currency pair.

The exact price between the bid and ask prices.

A micro lot is equal to 10,000 units of the base currency in a currency pair.

A large stock exchange in New York.

A stock market index of all shares traded on Nasdaq. It is weighted index according to the stocks’ capitalization.

The Navigator window is part of the Client Terminal. It lists the trader’s accounts, Expert Advisors, Indicators, Scripts and Custom Indicators.

Monthly report of New Home Sales of new single-family houses. Released by the U.S. Census Bureau and the Department of Housing and Urban Development.

A tab in the Terminal (MT4) or Toolbox (MT5) listing all News by Subject, Category and incoming Time.

National Futures Association. *Designated by the CFTC as a registered futures association, NFA strives every day to safeguard the integrity of the derivatives markets, protect investors and ensure Members meet their regulatory responsibilities. *NFA

A stock market index for the Tokyo Stock Exchange, composed of 225 stocks of large Japanese companies.

Cordoba Oro. The currency of Nicaragua. It is subdivided into 100 centavos.

When traders have direct access to the interbank market and there is no dealing desk involved in their transactions.

It is a Volume Indicator developed by Joseph Granville. Each day’s volume is assigned a plus or a minus sign, depending on whether the current day’s closing price is higher or lower than the previous day’s closing price. The result is added to a running cumulative total. If Closing Price current > Closing Price previous then add Volume If Closing Price current < Closing Price previous then subtract Volume If Closing Price current = Closing Price previous then no change The On Balance Volume should be in the same direction as the prevailing trend. Divergence is a signal that the prevailing trend is weakening and an impending reversal may be imminent.

In the course of a downtrend, a small white candle opens below the low of the prior long black body and closes at the aforesaid low.

In the course of an uptrend, a small black candle opens above the high of the prior long white body and closes at the aforesaid high.

Organization of Petroleum Exporting Countries. OPEC’s mission is to coordinate and unify the petroleum policies of its Member Countries and ensure the stabilization of oil markets in order to secure an efficient, economic and regular supply of petroleum to consumers, a steady income to producers and a fair return on capital for those investing in the petroleum industry. The twelve-member states are: Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates and Venezuela.

The total number of outstanding (long or short) contracts at the end of the trading day. Open Interest applies to futures and options markets.

A position taken on a financial instrument that is subject to profits or losses.

The initial price at the beginning of a trading period (i.e. timeframe).

A financial derivative where the buyer has the right to buy/sell an asset by the expiration date. More specifically, Call Options are contracts that give the owner the right (not the obligation) to buy an asset in the future (before or at the expiration date) at an agreed price. Investors buy Call Options when they believe that the value of the underlying asset will increase above the strike price. Similarly, Put Options are contracts that give the owner the right (not the obligation) to sell an asset in the future (before or at the expiration date) at an agreed price. Investors buy Put Options when they believe that the value of the underlying asset will decrease below the strike price.

It is a statistical tool that fluctuates around a horizontal middle line. At times the oscillator is plotted at extreme high readings, recording an overbought market. Conversely, when the oscillator moves at extreme low readings below the middle line it is recording an oversold market. Some oscillators are bounded i.e. they provide upper and lower boundaries which make overbought/oversold identification easy. In the absence of upper and lower boundaries, a visual inspection will do the trick.

See On Balance Volume.

Rial Omani. The currency of Oman. It is subdivided into 1000 baisa.

Oscillator Analysis: Confirms the trend. Determines overextended markets (Overbought/Oversold). Spots divergence between the oscillator and price.

Oscillator Moving Average. It displays the difference between MACD and its Signal Line (Moving Average).

See Over the Counter.

The traditional way of trading forex was ‘over the counter’, meaning traders made forex transactions over the telephone or on electronic devices.

When the market rises too far oscillators will reflect that rise with extreme high readings above the middle/equilibrium line, hence identifying overbought conditions. An oscillator at extreme high conditions can be an alert for a reversal. Oscillators usually give false signals in the beginning of a trend as they move too fast in the overbought area.

When a trader’s position is kept open and carried over to the next trading day.

The interest rate at which financial institutions in Canada borrow and lend money among themselves. It is updated 8 times per year and released by the Bank of Canada.

When the market drops too far oscillators will reflect that decline with extreme low readings below the middle/equilibrium line, hence identifying oversold conditions. An oscillator at extreme low conditions can be an alert for a reversal. Oscillators usually give false signals in the beginning of a trend as they move too fast in the oversold area.

Balboa. The currency of Panama. It is subdivided into 100 centésimos.

See PKR.

See XPD.

Parabolic Stop and Reverse is a technical indicator developed by Welles Wilder. It is based on the premise that a strong trend will continue to increase in strength and hence it will follow a parabolic arc. During an uptrend a SAR point starts far from the price and as the price accelerates upwards the SAR points (below the price in an uptrend and above the price during a downtrend) close the gap. When the SAR point reaches the price the long position is closed and a short is opened. It is a system that is always in the market either as long or short. The points (SAR) serve as trailing stop loss and trailing take profit. It works well during trending markets but it produces many false signals during sideways markets.

See MOP.

See TOP.

See Personal Consumption Expenditures.

Sol. The currency of Peru. It is subdivided into 100 centimos.

Orders to buy or sell a financial instrument in the future when certain conditions are met. They consist of limit orders and stop orders. Buy Limit Order: A predefined price to buy in the future. This is lower than the current market price. Sell Limit Order: A predefined price to sell in the future. This is higher than the current market price. Buy Stop Order: A predefined price to buy in the future. This is higher than the current market price. Sell Stop Order: A predefined price to sell in the future. The price is lower than the current market price.

A Continuation price pattern composed of a small symmetrical triangle, preceded by an almost straight-line move called a flagpole. The breakout of the pennant should be accompanied by heavy volume where available. The measuring implication is equal to the length of the pole. The pennant pattern causes a brief pause in the market that lasts less than 3 weeks.

A monthly report that measures the total expenditure by individuals. A high reading is seen as positive for the US Dollar. Released by the Bureau of Economic Analysis, Department of Commerce.

See Personal Consumption Expenditures.

See CUC.

See UYU.

Kina. The currency of Papua New Guinea. It is subdivided into 100 toea.

See PHP.

Philippine Peso. The currency of the Philippines. It is subdivided into 100 centimos.

During the course of a decline, a long white candlestick exceeds the midpoint of the previous long black candle. The white candle opens below the previous close or low. It is a bullish reversal pattern.

A point in price, or pip for short, is the measure of change in a currency pair in the forex market. The acronym can also stand for a “percentage in point” and “price interest point”. It is a standardized unit and is the smallest unit of measurement by which a currency quote can change. Most currency pairs are measured to five decimal places. For pairs like EURUSD, a pip corresponds to the fourth decimal digit [EURUSD 1.06712]. Yen-based currency pairs like USDJPY are the exception, and are measured to three decimal places and the pip corresponds to the second decimal digit (USDJPY 114.612).

Pivot Points are popular technical tools used by traders to identify price direction and get a feel for market sentiment. There are five calculation methods: Standard. Fibonacci. Camarilla. Woodie’s. De Mark’s. The Standard pivot point calculation method, also known as the Classic or Floor method, uses the previous period’s high, low and close price to calculate the current period’s direction/sentiment, as well as future support and resistance levels. Just like the Standard method, the Fibonacci method uses the previous candlestick’s high, low and close price to determine the current period’s direction. Future support and resistance levels are estimated by employing Fibonacci ratios 0.382, 0.618 and 1.00. Unlike all other pivot point methods, DeMark’s method uses the relationship between the previous period’s close and open prices, to determine which of the 3 formulas to use, when calculating support and resistance. The main Pivot Point is not part of the DeMark method. Camarilla Pivot Points provide a “road map” for both range and break-out traders, looking for potential turning points in the market. The emphasis is focused on the third support and resistance levels as potential reversals. Also, the fourth support and resistance levels play a key role in accelerating markets in both upward and downward directions. Woodie’s method is another variation of pivot points. The main pivot point represents the deciding factor of the market’s sentiment and its future direction. The corresponding support and resistance levels provide take profit opportunities and possible turning points. Unlike other pivot point methods, Woodie’s use the current period’s open price when calculating the main pivot point. Just like the other methods, the daily timeframe is the preferred timeframe for calculations.

Pakistan Rupee. The currency of Pakistan. It is subdivided into 100 paisa.

See XPT.

Zloty. The currency of Poland. It is subdivided into 100 groszy.

See ISM Manufacturing PMI.

It is the smallest increment of an exchange rate.

Price charts that display supply and demand. Demand is represented as a column of X’s and supply as a column of O’s. They ignore time and volume. Each box (i.e. X or O) represents a predefined price movement called the box size. Price movement less than the box size is ignored, thus noise is not recorded. A reversal, i.e. a column of X’s, is created after a column of O’s, when there is a price movement to the upside equal to the number of boxes - known as the reversal size. Conversely A reversal, i.e. a column of O’s, is created after a column of X’s, when there is a price movement to the downside- equal to the number of boxes - known as the reversal size. Point and figure charts are named after their box and reversal size, for example 1 x 3.

A long or short trade taken by a trader.

See GBP.

A monthly report showing the monthly change in price of finished goods and services charged by producers. It provides an indication of consumer inflation. A high reading is seen as positive for the US Dollar whereas a low reading is perceived as bearish. Released by the Bureau of Labor Statistics.

See PPI.

The ratio between gross profits and gross losses.

Closing a position to take a profit.

The number of profitable trades.

See BWP.

See ISM Manufacturing PMI.

Guarani. The currency of Paraguay.

Qatari Rial. The currency of Qatar. It is subdivided into 100 dirhams.

See QAR.

Identifies investment potential by studying unquantifiable factors that affect the market movement, such as traders’ sentiment, Psychology and behavior. Technical Analysis is a form of Qualitative Analysis, as many concepts and theories such as Elliott Wave Theory, Dow Theory and Cycle Theory study the behavior of the market participants.

Identifies investment potential by applying mathematical and statistical models. Technical analysis is a form of quantitative analysis, as indicators and technical tools are based on mathematical and statistical models.

Monetary policy to stimulate economic growth and lift the economy out of stagnation. Central Banks increase money supply in the market by “printing money”, lowering interest rates and making money available to consumers to spend and businesses to invest.

See GTQ.

It’s the price that a financial instrument may be bought (Ask price) or sold (Bid price).

The second currency of a currency pair is called the Quote currency. In EUR/USD for example, USD is the quote currency.

Upward price movement after a period of sideways movement or decline.

See ZAR.

Claims that price changes are serially independent and as such they are random and unpredictable.

When price action is confined between a support and a resistance level. Also known as a sideways market, flat market or trendless market.

See Exchange Rate.

See ROC.

Also known as body, it is the rectangular area between the open and the close price on a Japanese Candlestick. If the close is higher than the open price then the color is white; signifying positive sentiment. Conversely, if the open is higher than the close price, the color is black; suggesting negative sentiment.

A contraction in economic activity. A period of two consecutive quarters of declining Gross Domestic Product (GDP).

The ratio of gained profit to maximum drawdown.

A continuation price pattern, when prices are trading in a confined area between two parallel flat lines. It is also known as range or consolidation. Even though it is expected to break out in the direction of the prevailing trend, it is not unusual to break out in the opposite direction. If volume information is available, it may hint in the break out direction well before it happens, as price movement tends to be higher or heavier in the direction of the breakout. Breakout of the range should also be accompanied by heavy volume to be considered valid. Measuring implications are calculated as the width of the range.

A market governed by legislative rules and regulations which are in place to protect investors.

The highest percentage drop of Equity.

See RSI.

A technical indicator based on the premise that during an uptrend, the closing price is usually higher than the open price. Conversely, during a downtrend, the closing price is usually lower than the open price. The calculation formula is: RVI = (Close – Open) / (High – Low) For further smoothing, a 10-period Simple Moving Average may be applied on the resulting RVI. Furthermore, a 4-period Signal Line may be constructed by applying a Symmetrical Weighted Moving Average on RVI. A potential buy signal is triggered when there is a positive divergence between the oscillator and price, especially when RVI is in extreme oversold territory. Conversely, a potential sell signal is in place when there is a negative divergence and RVI is in extreme overbought territory.

A price charting method. A price move is registered as a “brick” in the direction of the trend, as long as the move is equal to the box size, i.e. the minimum amount. There are two types of bricks - white and black. A reversal to the downside takes place when a black box emerges after a series of white bricks. Conversely, a reversal to the upside takes place when a white brick is registered after a series of black bricks. The concept of box size helps to smooth out “noise” as price movements less than the box size are not registered.

When a broker is not able to fill a trader’s order at the specific price due to an unusually rapid price movement. The broker would then quote the next best available price, seeking the trader’s confirmation to fill the order.

A strong currency that Central Banks and other Financial Institutions hold as part of their currency reserves.

A price level usually defined as a previous top, where selling pressure overcomes buying pressure. As a result, prices may find it difficult to break above.

An individual investor who trades the markets for his own benefit rather on behalf of an organization. Usually individual investors invest smaller amounts in contrast to institutional investors.

An economic report presenting the US total retail sales as well as the percentage change of the last month. It is based on a survey of about 5000 retail firms. It shows demand in consumer goods which constitutes about 70% of the GDP. Released, monthly by the US Census Bureau.

See correction.

A channel consisting of two parallel lines; the basic trendline and the return or channel line. In an uptrend the return line is drawn by joining the tops of the channel whereas in a downtrend, the return line is drawn by joining the bottoms of the channel. The return line serves as a profit-taking indicator for short-term traders.

A turning point in the price chart.

A price formation that signifies the end of a trend in one direction and the beginning of a new trend in the opposite direction. The most popular reversal pattern is “Head and Shoulders”.

It is the ratio of potential profits to potential losses. For example, if a trade suffers a 50 pip loss, then the expected return may be 150 pips, if 3:1 reward-to-risk is used.

See OMR.

See KHR.

A Japanese Candlestick bullish continuation pattern. In the course of an uptrend, a long white body is followed by three small candlesticks formed between the previous candle’s range- triggering a pause in the market. The resumption of the uptrend is signaled by the presence of the fifth candle which is a long white body.

The potential of a negative outcome such as underperforming, failing to achieve investment/trading goals or losing money.

The amount of risk a trader is willing to take.

Refers to the level of tolerance of uncertainty. Traders with risk aversion prefer lower returns with known risks (usually low risk) over higher returns with unknown/uncertain risks (usually high risk).

It refers to the controls applied to mitigate trading risk, for example: Stop Loss. Position Size. Reward-to-Risk Ratio.

It is a technical oscillator that measures the rate of ascent or descent in the price of a financial instrument. It measures the difference between the current price and the price n periods ago (Close Recent – Close n periods ago). If the difference is above the zero-line and rising then it is presumed that the uptrend is accelerating. If the difference is below the zero-line and falling, the downtrend is accelerating. If the difference is above the zero-line and falling, the uptrend is decelerating. Similarly, if the difference is below the zero-line and rising, the downtrend is decelerating. ROC follows the general oscillator analysis: A crossing of the oscillator above the zero-line triggers a buy signal. A crossing of the oscillator below the zero-line triggers a sell signal. Divergence between the oscillator and price gives early signals of a reversal. Overbought/Oversold levels are not easily spotted on the ROC Oscillator since it is unbounded. Hence, visual inspection is used to identify extreme readings above and below the zero-line.

In forex, the rollover rate is the interest rate that traders pay or earn when they hold (rollover) a position open overnight.

See RON.

Romanian Leu. The currency of Romania. It is subdivided into 100 bani.

Refers to the total amount of funds involved in opening and closing a position.

Serbian Dinar. The currency of Serbia. It is subdivided into 100 paras.

Relative Strength Index. A popular technical indicator developed by Welles Wilder. It addresses erratic price movements in the markets by smoothing prices using the following formula: RSI = 100 - (100 / (1+ (Average of n up closes / average of n down closes))) The default value is 14 but 9 may also be used. RSI is bounded between 0 and 100. When the oscillator moves above 70 it is considered overbought and a reversal warning is indicated. If there is a negative divergence between the price and the RSI, then a potential sell indication is in place. When the oscillator moves below 30 it is considered oversold and hence a reversal alert is indicated. If there is a positive divergence between the price and the RSI, a possible buy indication may be in place.

Russian Ruble. The currency of the Russian Federation. It is subdivided into 100 kopeks.

See MVR.

A gap that follows a breakaway gap. It usually forms in the middle of a trend and hence is also known as measuring gap.

See IDR.

See RUB.

See RWF.

Rwanda Franc. The currency of Rwanda.

A financial instrument or asset where the risk of it losing its value is relatively low.

See SHP.

Saudi Riyal. The currency of Saudi Arabia. It is subdivided into 100 halalas.

See SAR.

Solomon Islands Dollar. The currency of the Solomon Islands. It is subdivided into 100 cents.

A trading strategy that benefits from small price movements.

Seychelles Rupee. The currency of the Seychelles. It is subdivided into 100 cents.

Sudanese Pound. The currency of the Sudan. It is subdivided into 100 piasters.

Swedish Krona. The currency of Sweden. It is subdivided into 100 ore.

A pending order to sell at a predefined price higher than the market price in anticipation that the market will eventually decline.

A pending order to sell at a predefined price lower than the market price, in anticipation that the market will continue to decline.

A pending order that combines the Sell Stop and Sell Limit Orders. It allows a trader to specify a price lower than the current price that when reached, a Sell Limit ordered is placed at a higher price level.

Substantial sale of a financial instrument with rapidly declining prices. It is usually characterised by panic amongst traders.

The investors’ expectations about the direction of a financial instrument or market.

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. The Next candlestick is a long black body opening at the same price level as the opening of the previous white candlestick but eventually closing lower, signaling the continuation of the downtrend.

Japanese candlestick bullish continuation pattern. During the course of an uptrend, the appearance of a long black candlestick is common, as a correction is part of the prevailing trend. The next candlestick is a long white body opening at the same price level as the opening of the previous black candlestick, signaling the continuation of the uptrend.

See RSD.

The transfer of ownership of a financial instrument to a buyer.

See SCR.

Singapore Dollar. The currency of Singapore. It is subdivided into 100 cents.

The vertical line that extends above and below the body/real body of a Japanese candlestick. It defines the range between the high and the low price for the specific period.

Japanese candlestick bearish pattern. A Shooting Star formed at the end of an uptrend or at a resistance area has bearish reversal implications. Traders enter the market with long positions but eventually the sellers’ pressure overcomes buyers’ pressure and the candlestick closes at the lower area of the Shooting Star. The small body and the long upper shadow reveals the weakness of the bulls, who are unable to maintain the upward move.

The sale of a financial instrument to be bought later at a lower price.

See KGS.

See SOS.

See TJS.

Somali Shilling. The currency of Somalia. It is subdivided into 100 senti.

See SSP.

A trader in financial markets who aims to gain from anticipated future market moves.

A sudden upward or downward movement in price that happens in a short time period.

The current market price of a financial instrument.

The difference between the Ask and Bid price of a currency pair.

Surinam Dollar. The currency of Surinam. It is subdivided into 100 cents.

See LKR.

South Sudanese Pound. The currency of South Sudan. It is subdivided into 100 piasters.

It is a statistical term denoted by the Greek letter (sigma). It is calculated by the following steps: Calculate the mean for a population of n prices (i.e. close). Subtract each price from the mean and then square the result. Sum all squared differences and then divide by the population n. Take the square root of the above.

A Technical Analysis tool based on the Linear Regression Trendine and the specified number of Standard Deviations. It is attached on the chart by selecting the first price representing the beginning of the trend and then dragging the mouse to the second price in the direction of the trend. It consists of three lines: Linear Regression Trendline. Upper Channel Line. Lower Channel Line. 68% of the prices will fall within the range of 1 standard deviation of the Linear Regression Trendline. 95% of the prices will fall within the range of 2 standard deviation2 of the Linear Regression Trendline. 99.7% of the prices will fall within the range of 3 standard deviations of the Linear Regression Trendline. Prices trading above or below the Channel Lines hint for a reversal.

100 000 units of the base currency.

See BDT.

An order placed to close a position so as to lock profits once it hits a specific price.

An order placed to close a position once it hits a specific price.

See WST.

See TZS.

The study of market action mainly through price charts for the purpose of identifying future price trends in early stages.

Technical analysis applies to all: - Timeframes; - Financial Instruments.

Technical Analysis has received some criticism throughout the years: It is based on self-fulfilling prophecy. Prices move at random hence markets are not predictable.

Technical Analysis is based on 3 premises: Market action discounts everything. Markets move in trends. History repeats itself.

See Indicator.

See KZT.

One of the lines of Ichimoku Kinko Hyo. It is a 9-period moving average of the mid-prices; (Highest High + Lowest Low)/2 for the last 9 periods. It provides signals when combined with Kijun-sen.

but the same thing happened at the same time as some great labor and pain.

A Japanese candlestick pattern signaling a bearish reversal. It forms at the end of a rally or near a resistance area. At the top of the uptrend the presence of three consecutive long black candlesticks signifies the end of the upward move and the beginning of a new move in the opposite direction. Each Marubozu opens above the previous close and concludes below it. The lower shadows are very small if present - thus demonstrating the strength of the decline.

A Japanese candlestick pattern signaling a bearish reversal. It forms at the end of an uptrend or near a resistance area. A small candlestick body of either color follows a candlestick of a long white body. The color of the small candlestick is not important. The two candles form a Harami pattern. The bullish rally is running out of steam as shown by the presence of the small candle, which signals uncertainty as it is contained by the previous long body. The weakness of the market to move higher and the presence of the pattern at the end of a rally, signals possible bearish implications. The long black body that follows, extending below the second candle’s close, confirms the bearish reversal.

A Japanese candlestick pattern signaling a bullish reversal. It forms at the end of a downtrend or near a support area. A small candlestick body of either color follows a candlestick of a long black body. The color of the small candlestick is not important. The two candles form a Harami pattern. The bearish decline is running out of steam as shown by the presence of the small candle, which signals uncertainty as it is contained by the previous long body. The weakness of the market to move lower and the presence of the pattern at the end of a decline, signals possible bullish implications. The long white body that follows, extending above the second candle, confirms the bullish reversal.

A Japanese candlestick pattern signaling a bearish continuation. During a downtrend, three consecutive long black candlesticks (i.e. Three Black Crows) signify the strength of the downside momentum. The fourth candlestick, a long white body, opens below the third candle’s open and closes above the first candle’s close in the opposite direction.

A Japanese candlestick pattern signaling a bullish continuation. During an uptrend, three consecutive long white candlesticks (i.e. Three White Soldiers) signify the strength of the upside momentum. The fourth candlestick, a long black body, opens above the third candle’s close and closes below the first candle’s open in the opposite direction.

A Japanese candlestick pattern signaling a bearish reversal. It forms at the end of an uptrend or near a resistance area. Just like an Engulfing Pattern, a long black candlestick is formed at the end of an uptrend preceded by a small white candlestick. The body of the small white candlestick is completely engulfed by the body of the long black candlestick. The bullish pressure of the prevailing upward move, is overcome by the sellers entering the market aggressively at the top of the rise-forming a long black candlestick with bearish implications. The presence of the long black candle at the third session which closes lower than the prior close, confirms the bearish reversal.

A Japanese candlestick pattern signaling a bullish reversal. It forms at the end of a downtrend or near a support area. Just like an Engulfing Pattern, a long white candlestick is formed at the end of a downtrend preceded by a small black candlestick. The body of the small black candlestick is completely engulfed by the body of the long white candlestick. The bearish pressure of the prevailing downward move, is overcome by the buyers entering the market aggressively at the end of the decline-forming a long white candlestick with bullish implications. Additionally, the presence of the long white candle at the third session which closes higher than the second candle, confirms the bullish reversal.

A Japanese candlestick pattern signaling a bullish reversal. It forms at the end of a downtrend or near a support area. While the market is in a downtrend, a long black body with a long lower shadow forms in the same direction. The second candle is a small black candle with a relatively long lower shadow as well but above the previous one. The third candle in the pattern is again a small black candlestick with very small or non-existent shadows. The body of the last candlestick is contained within the range of the previous candle.

A Japanese candlestick pattern signaling a bullish reversal. It forms at the end of a downtrend or near a support area. At the end of the downtrend or decline, the presence of three consecutive long white candlesticks signify the end of the downward move and the beginning of a new move in the opposite direction. Each Marubozu opens below the previous close and concludes above it. The upper shadows are very small if present - thus demonstrating the strength of the ascent.

During trading hours Bid/Ask prices change as new incoming prices are received. A tick represents any single incoming price quote.

There are 4 major categories: Long term. Seasonal. Primary or Intermediate. Trading.

It is applied to the breaking of trendlines, support and resistance. Sometimes a close is needed above or below the line or 2 closes or 2 days or a Friday close to name just few popular filters.

It is based on the study of the past. To forecast the future, one needs to study previous data.

To determine specific entry/exit points in the market.

Somoni. The currency of Tajikistan. It is subdivided into 100 diram.

Turkmenistan New Manat. The currency of Turkmenistan. It is subdivided into 100 Tennessee.

Tunisian Dinar. The currency of Tunisia. It is subdivided into 1000 milim.

Pa’anga. The currency of Tonga. It is subdivided into 100 seniti.

During the course of an uptrend, the recording of a higher high followed by a lower close (lower than the previous close) suggests a reversal. The wide range of the day (bar or candlestick) and the accompanied heavy volume define the strength of the reversal. Also, known as buying climax.

A Japanese candlestick pattern signaling a bullish reversal. It forms at the end of a downtrend or near a support area. In the course of a decline a long black candle reaffirms the negative sentiment in the market. The following three candles are of small real bodies, displaying indecision. The last candlestick is a long white body, signaling a reversal.

In the course of a rally a long white candle reaffirms the positive sentiment in the market. The following three candles are of small real bodies, displaying indecision. The last candlestick is a long black body, signaling a reversal.

The difference between a country’s exports and imports. More exports than imports result in a trade surplus. If there are more imports than exports, it results in a trade deficit.

In Time Cycles, a trading cycle is 4 weeks long. It consists of the alpha (2 weeks) and beta (2 weeks) cycles.

Some of the most popular orders are: Instant Execution. Market Order. Buy Stop. Sell Stop. Buy Limit. Sell Limit. Buy Stop Limit. Sell Stop Limit.

See Trading System.

Trading software (i.e. MT4, MT5) is provided by the broker for traders to place, manage and close positions electronically. The platform provides account management, live market prices, news feeds and charting tools.

It is characterized by equal tops and bottoms. It is also known as sideways or trendless market. It is a state of the market where supply and demand are in equilibrium.

The trading hours of the foreign exchange market are divided into 4 broad categories: European (8:00am – 5:00pm). American (1:00pm – 10:00pm). Australian (10:00pm – 7:00am). Tokyo (1:00am – 9:00pm).

See Trading System.

There are many different styles of trading to suit a trader’s profile, knowledge and time: Day Trading. Buy-and-Hold. Scalping. Mechanical Trading. Automated Trading. Discretionary Trading. Copy Trading. Position Trading. Trend Following. Range-bound Trading. Break-out Trading. News Trading.

A detailed plan on how to trade the financial markets. It is a step-by-step set of instructions on when to enter the market, when to exit with minimal loss once the market goes against you and when to book profits.

A stop loss order that is applied on profitable positions to lock in profits. It follows the market price at a distance equal to a predetermined number of points. It is set on the Client Terminal as opposed to the Stop Loss order that is set on the Server.

The direction of successive tops and bottoms: Uptrend – Successive higher tops and higher bottoms. Downtrend - Successive lower tops and lower bottoms. Trendless (Range, Sideways) – Equal tops and equal bottoms.

Trends fall under three categories: Major. Intermediate. Near term trends.

Trend has three directions: Up. Down. Sideways.

Trading in the direction of the established trend.

A very important concept in Technical Analysis. It is a straight line connecting successively higher bottoms during an uptrend or successively lower tops during a downtrend. Trendlines are used to open long positions during an uptrend and short positions during a downtrend. On the other hand, violation of the trendline is an early warning for a reversal.

A Japanese candlestick pattern signaling a bearish reversal. It forms at the end of an uptrend or near a resistance area. During a prolonged rally, a formation of three consecutive Doji candlesticks, signals that the uptrend may be coming to an end. Second Doji gaps above the first and the third candles.

A Japanese candlestick pattern signaling a bullish reversal. It forms at the end of a downtrend or near a support area. During a prolonged decline, a formation of three consecutive Doji candles, signals that the downward move may be coming to an end. Second Doji gaps below the first and the third candlesticks.

A continuation pattern comprised of two converging sides with at least 4 reversal points (2 tops and 2 bottoms). The opening (height) of the triangle is called the base whereas the intersection of the two sides is called the apex. Three popular types of triangles are: Symmetrical (coil) – Two converging sides. Upper trendline is descending whereas the lower trendline is ascending. Ascending – The upper side is flat whereas the lower side is ascending. Descending – The lower side is flat whereas the upper side is descending. Volume is usually heavier on the breakout side hence giving hints to which side to expect the breakout. Two measuring techniques are available for triangle breakouts: Height projection – Project the height at the breakout point to estimate the minimum target. Parallel line – Draw a parallel line from the top of the base to the triangle side. The minimum target is estimated at the parallel line with an approximate time forecast the intersection of the 2 triangle sides (apex).

See TTD.

During the course of a downtrend the presence of three bottoms at about the same level and the breaking of the corresponding two tops, signal a reversal. Heavy volume (if available) confirms the reversal.

A trading method with 3 moving averages: a short-term, medium-term and long-term. A buy signal is triggered in a downtrend when the short moving average crosses above both the medium and the long moving average and in turn, the medium moving average crosses above the long moving average. A sell signal is triggered in an uptrend when the short moving average crosses above both the medium and long moving average and in turn, the medium moving average crosses above the long moving average. Popular triple crossover systems are 4-9-18 and 5-10-20.

During the course of an uptrend the presence of three tops at about the same level and the breaking of the corresponding two bottoms, signal a reversal. Heavy volume (if available) confirms the reversal.

The area below the market price when buying interest overcomes selling pressure. Also, known as bottom or support.

Turkish Lira. The currency of Turkey. It is subdivided into 100 kuruş.

Trinidad and Tobago Dollar. The currency of Trinidad and Tobago. It is subdivided into 100 cents.

See MNT.

See TND.

See TRY.

See TMT.

New Taiwan Dollar. The currency of Taiwan (Province of China). It is subdivided into 100 cents.

A Japanese candlestick pattern signaling a bearish reversal. It forms at the end of a rally or near a resistance area. As the market continues to trade in the direction of the established uptrend, registering higher highs the next session is bearish, pushing prices lower. The matching highs indicate that a possible top may be in place and a reversal may be imminent.

A Japanese candlestick pattern signaling a bullish reversal. It forms at the end of a decline or near a support area. The market trades in the direction of the established decline forming a long black candle, registering lower lows. The next session registers a matching low and eventually forms a bullish candlestick hence, pushing prices higher. The matching lows indicate a possible reversal may be imminent.

A Japanese candlestick pattern signaling a bearish reversal. It forms at the end of an uptrend or near a resistance area. In the course of an uptrend, the presence of a long white candlestick reaffirms the bullish sentiment. The second candle is a relatively small candle that gaps higher than the previous high but closes lower than its own open price forming a black candle. The third candle is a long black body that opens within the body of the small black candlestick, fills the gap and closes in the body of the long white candlestick, hence signaling a potential bearish reversal.

The average of the high, low and closing price of a trading period: (High+Low+Close)/3

Tanzanian Shilling. The currency of Tanzania. It is subdivided into 100 senti.

See AED.

Hryvnia. The currency of Ukraine. It is subdivided into 100 kopiyky.

See UGX.

Uganda Shilling. The currency of Uganda.

The percentage of the labour force that during the last month that had no work but made specific efforts to find employment. Released monthly by the Bureau of Labor Statistics.

Japanese Candlestick bullish pattern. A long black candle forms in the direction of the downtrend. The next candle is a hammer that opened higher and tested lower prices levels but eventually rejected as shown by the long lower shadow. The third candle is a small white body formed below the hammer’s body showing signals that the market is not willing to move lower.

Japanese candlestick bullish continuation pattern. In an uptrend, two long white candles with a rising window in between are followed by a long black candle that fills the window (i.e. gap).

Japanese candlestick bearish pattern. During the course of an uptrend a long white body is followed by a shorter black body that gaps higher. A black candle that follows, opens at or above the previous open. It then pushes the market lower, well into the long white candle’s body and more specifically, below the close of the second body but above the close of the first candlestick.

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 trend. A third candle, black this time, closes (but does not fill) within the gap.

See USD.

US Dollar. The currency of the United States of America, American Samoa, Bonaire, Sint Eustatius and Saba, the British Indian Ocean Territory, Equador, El, Salvador, Guam, Haiti, the Marshall Islands, Federated States of Micronesia, the Northern Mariana Islands, Palau, Panama, Puerto Rico, Timor-Leste, the Turks and Caicos Islands, United States Minor Outlying, British Virgin Islands, U.S. Virgin Islands. It is subdivided into 100 cents.

Peso Uruguayo. The currency of Uruguay. It is subdivided into 100 centesimos.

See UZS.

Uzbekistan Sum. The currency of Uzbekistan. It is subdivided into 100 tiyin.

The date that the transaction actually takes place.

See VUV.

Bolivar. The currency of the Bolivarian Republic of Venezuela.

A server that runs 24/7 without any downtime due to internet connectivity, electricity cutoffs or hardware faults. Ideal for automated trading (expert advisors).

Dong. The currency of Vietnam.

This refers to the level of uncertainty surrounding price fluctuations of financial instruments. Volatility is usually characterized by rapid, random price movements.

The amount of a specific financial instrument which has exchanged hands during a trading day.

A server that runs 24/7 without any downtime due to internet connectivity, electricity cutoffs or hardware faults. Ideal for automated trading (expert advisors).

Vatu. The currency of Vatu.

Price action in one of the three market directions: up, down or sideways.

See Elliott Wave Theory.

A continuation price pattern. It consists of two converging trendlines that intersect at a point called the apex. Wedges usually slant in the opposite direction from the prevailing trend. Hence, a falling wedge appears during an uptrend whereas a rising wedge appears during a downtrend.

See Linearly Weighted Moving Average.

See WTI.

Sudden price movements in the opposite direction, usually leading to false or bad signals. For example, while the price is rallying upwards suddenly it swings direction and follows a downward path until it bounces up again. It is a characteristic of volatile markets.

A technical indicator developed by Larry Williams. It is used to identify extreme price movements i.e. overbought and oversold levels. It uses an upside-down scale. Readings from 0 to -20 imply overbought levels whereas readings between 80 and 100 imply oversold levels. The %R indicator often anticipates reversals as it forms a top and turns down before the underlying financial instrument does and similarly, it forms a bottom and turns up before the price does. To calculate %R, take the difference between the Highest High of the last n periods and the current closing price - this is the dividend. Furthermore, take the difference between the Highest High of the last n periods and the Lowest Low of the last n periods - this is the divisor. Finally multiply the quotient by -100.

See KRW.

Tala. The currency of Samoa. It is subdivided into 100 sense.

West Texas Intermediate: WTI is considered one of the major benchmarks for crude oil pricing globally. It has a low Sulphur content (sweet) and it has a relatively low density (light). Hence, it is also known as Texas Light Sweet. It is listed in the New York Mercantile Exchange's oil futures.

CFA Franc BEAC. The currency of Cameroon, The Central African Republic, Chad, The Congo, Equatorial Guinea and Gabon.

Silver.

Gold.

East Caribbean Dollar. The currency of Anguilla, Antigua and Barbuda, Dominica, Grenada, Montserrat, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines. It is subdivided into 100 cents.

CFA Franc BCEAO. The currency of Benin, Burkina Faso, Cote D'Ivoire, Guinea-Bissau, Mali, The Niger, Senegal and Togo.

Palladium.

CFP Franc. The currency of French Polynesia, New Caledonia, Wallis and Futuna.

Platinum..

Yemeni Rial. The currency of Yemen. It is subdivided into 100 fils.

See JPY.

Yemeni Rial. The currency of Yemen. It is subdivided into 100 fils.

Yield is the return on an investment and is usually expressed as a percentage.

See CNY.

See ZMW.

Rand. The currency of South Africa. It is subdivided into 100 cents.

A technical indicator that draws tops and bottoms - filtering out noise.

See ZWL.

Zambian Kwacha. The currency of Zambia. It is subdivided into 100 Ngwee.

Zimbabwe Dollar. The currency of Zimbabwe. It is subdivided into 100 cents.