FXA Systems – Download The Best Trading Indicators

Trading Glossary

The Forex market can be overwhelming, especially for new traders. That\’s why we\’ve created this Forex Glossary, a definitive resource that defines and explains the key terms and concepts you need to know to succeed in the world of currency trading.

TermDescription
Ask PriceThe price at which a trader can buy a financial instrument.
Bid PriceThe price at which a trader can sell a financial instrument.
SpreadThe difference between the bid and ask prices.
LeverageThe use of borrowed funds to increase the potential return of an investment.
MarginThe amount of money required to open and maintain a leveraged position.
PipThe smallest price movement in a currency pair, typically equivalent to 0.0001.
LotA standardized trading size representing a certain amount of currency units.
Stop-Loss OrderAn order placed to limit potential losses by automatically closing a position at a specified price.
Take-Profit OrderAn order placed to lock in profits by automatically closing a position at a specified price.
Margin CallA notification from a broker to add more funds to an account to meet margin requirements.
VolatilityThe degree of variation in the price of a financial instrument over time.
TrendThe general direction in which the price of a financial instrument is moving over time.
Support LevelA price level at which a financial instrument tends to find buying interest, preventing further price declines.
Resistance LevelA price level at which a financial instrument tends to find selling interest, preventing further price increases.
Moving AverageA technical indicator that smooths out price data to identify trends over a specified period.
RSI (Relative Strength Index)A momentum oscillator that measures the speed and change of price movements.
MACD (Moving Average Convergence Divergence)A trend-following momentum indicator that shows the relationship between two moving averages.
Fibonacci RetracementA technical analysis tool used to identify potential support and resistance levels based on the Fibonacci sequence.
CandlestickA type of price chart that displays the open, high, low, and close prices for a specific period.
Bear MarketA market characterized by falling prices and pessimism among investors.
Bull MarketA market characterized by rising prices and optimism among investors.
DiversificationSpreading investments across different assets to reduce risk.
HedgingA strategy used to reduce or offset the risk of adverse price movements in a financial instrument.
ArbitrageProfiting from price differences of the same financial instrument in different markets.
LiquidityThe ease with which a financial instrument can be bought or sold in the market without significantly affecting its price.
SlippageThe difference between the expected price of a trade and the price at which the trade is executed.
OverboughtA condition in which the price of a financial instrument has risen too far and too fast, signaling a potential reversal.
OversoldA condition in which the price of a financial instrument has fallen too far and too fast, signaling a potential reversal.
Market OrderAn order to buy or sell a financial instrument at the current market price.
Limit OrderAn order to buy or sell a financial instrument at a specified price or better.