forex glossary

LEARN ALL ABOUT CURRENCY TRADING!

Check our forex glossary in order to understand common words, phrases and terms used by forex traders.

Forex glossary

The last day you may trade a particular product. 

The last time you may trade a particular product. 

The last day in which trading is permitted before a market expires.

Statistics that are considered to predict future economic activity. 

A price zone or particular price that is significant technically or based on reported orders/option interest. 

Also known as margin, this is the percentage or fractional increase you can trade from the amount of capital you have available. It allows traders to trade notional values far higher than the capital they have. For example: leverage of 100:1 means you can trade a notional value 100 times greater than the capital in your trading account.* 

Short-term traders, referring largely to the hedge fund community. 

Potential loss, debt or financial obligation. 

London Interbank Offered Rate. The interest rate that commercial banks lend to each other in the UK. There is a fixing everyday at 11am which is used for a lot of global calculations.

The London Inter-Bank Offered Rate. Banks use LIBOR as a base rate for international lending. 

The maximum that a market is allowed to fall at any one time by its regulators.

An order to buy or sell at a more advantageous level than where the market last traded.

The maximum that a market is allowed to rise at any one time by its regulators.

An order that seeks to buy at lower levels than the current market or sell at higher levels than the current market. A limit order sets restrictions on the maximum price to be paid or the minimum price to be received. As an example, if the current price of USD/YEN is 117.00/05, then a limit order to buy USD would be at a price below the current market, e.g. 116.50. 

When a market has a lot of buying and selling volume going through, not affecting the price. 

A market which has sufficient numbers of buyers and sellers for the price to move in a smooth manner. 

The closing of an existing position through the execution of an offsetting transaction. 

The ability of a market to accept large transactions with minimal to no impact on price stability. 

08:00 – 17:00 (London). 

A position that appreciates in value if market price increases. When the base currency in the pair is bought, the position is said to be long. This position is taken with the expectation that the market will rise. 

Traders who have bought a product. 

Nickname for USD/CAD. 

A unit to measure the amount of the deal. The value of the deal always corresponds to an integer number of lots.

The lowest point at which a market traded.

send message