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Forex Glossary

Knowledge is power; It always was and always will be. The other way isnt possible Im sure you know the proverb saying, The ones who hold the knowledge rules the world. Each one of us desires to rule this world Ok, maybe not the entire world, but at least, his own business! But we all need more knowledge. We all need studying each day. In order to provide you with comprehensive knowledge about foreign exchange trading terms, or Forex terms for short, our Forex Glossary will help you to increase your level of knowledge. Knowing Forex Trading Terms is essential for currency traders. Do you know what currency traders mean when they talk about a ton of money, or what it means when you read in the news feed from your broker the loonie is under pressure, the EUR just broke through the 38.2 fibonacci retracement level? Not exactly? Well, it is time to learn about today! Not knowing Forex terms means you will misinterpret outcome from news, have a hard time to participate in trading and forum discussions and an even harder time to make profit trading Forex. When you are already experienced trader make sure you keep your knowledge always up to date and keep learning. When you are new to the currency trading world, study the Forex Glossary carefully. We update the Forex Glossary on a regular base and add new terms, which appear to be important for foreign exchange traders. We also recommend to you to add this page to your browsers or social bookmarks and visit the Forex Trading Glossary section from time to time to wide your knowledge all the time. This will definitely help you in your trading!

A Ton of Money
Phrase which is used in informal style, mostly slang language and means an immense sum of money. This term arises in various definitions from what is exactly a large amount of money. According to the Bureau of Engraving and Printing, a ton of bank notes at par value of one United States Dollar is equal to 908 000 USD about $1 million.

In coins thereafter it is different. The official weight of contemporary U.S. quarters as the US Mint confirms are 5.67 grams so one ton of money will value 40 thousand United States Dollars. And concerning pennies (at 2.5 grams each it counts 363 000 pennies) a ton of these coins will be worth only 3 632 USD.

Backtesting Forex Strategies


A procedure in researching the trading strategies which were taken place some years ago in the past with the aim of doing a simple simulation of its strategy with the intention of measuring its efficiency.

The outcome of such strategies depends very much on the process which had happened in the tested period. The followers of this back testing strategy admit that it is, as likely as not, that events of the past will occur in the future. That is why it has some risk and to prevent this, it is very important to find such a back testing forex strategy that will work with real data as well as with historical data. Most of the strategies for the analysis are tested with this method. All profitable forex systemsoffered from us are tested with historical data from at least 10 years using the Metatrader Forex trading platform.

Cable
Cable, also known as is a term used in slang language among Forex traders to indicate the swaprate between British Pound Sterling and U. S. dollar. A wide usage of this term takes its origins from 1880s because of transatlantic cable, which was used to transfer the exchange rate of the major currency between Britain and the USA.

Furthermore, cable is used as a slang term in the forex market for the name of British Pound Sterling.

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Daily Forex Chart


It is a certain forex chart which represents daily fluctuations of the given capital issues. It confronts to longer charts in terms that show the fluctuations during days, months and even years. Daily Forex charts show all the price changes for the certain period and mostly used by day traders to accomplish short-term tactics.

As Forex trades round it is obviously that trading between one trading day, and another is not stopping as it is on the other markets. That is why there is an agreement to regard a Forex day to be from 5 pm EST to the identical time in the next day and as a result mainly daily Forex charts are shown in this direction. Related: MT4 expert advisor

Easy Forex Strategy


These are easy forex strategies that help to teach how to trade the market with a result of making extra income with the help of received profits. Easy Forex strategy helps the beginners to start learning the basics of the forex market. This strategy advises what indicators you should use, what behavior would be expected after making the decision.

It is very important to learn the basic elements of the strategy, and afterwards it is needed a reinforcement on the practice. Using easy forex strategy helps to organize the knowledge received about Forex trading, and a good and easy Forex strategy is a strategy that should work for the new trader in a medium period of time. These Forex strategies and techniques are devoted to help the traders in their attempts and research and developing of appropriate trading tactics and systems.

Fibonacci
It is a system which can predict rationally the trading area of markets. It is based on ratios that are derived from the Fibonacci sequence and used by traders to improve their strategies in the floating foreign exchange market.

It calculates the Fibonacci foreign exchange rating for every movement in prices on the chart. According to the observations of the fluctuations in Forex charts, the profits may rise greatly because of the proximity of Fibonacci ratios to the indicators of changing prices. The strategies that are based on Fibonacci ratios help to predict and calculate the key turning points in the Forex trading for better analysis in Forex market and simplification of making an income. A lot of traders make profits from the system based on Fibonacci. Related: Fibonacci Calculator, Fibonacci Formula, Fibonacci Retracement, fibonacci retracement calculator

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Global Currency Trading


As the forex market is one of the largest in the world it means that most of the financial institutions, banks and multinational corporations participate in it. They sell and buy currencies in huge amounts to manipulate the claims of international trade.

Global currency trading involves trillions of dollars to make profits from fluctuations in exchange rates and in speculating on currency variations. As we can see trading is a global system throughout the whole world.

Hard Currency
Hard currency is a type of currency also called strong currency that has a stable exchange rate with respect to other currencies, which are freely converted into another currency and are widely used in the international transactions in the capacity of standard of deferred payments. It tells about stability of the country in its political and economic situations.

Hard currency is accepted throughout the world as a form of paying for goods and services. It is a stable currency and has a high liquidity in the Forex. The examples of such a hard currency are the British pound and the United States dollar.

Inflation
Inflation is the condition when the general level of prices for purchasing increases. Government always tries to decrease the inflation with the aim to minimize it or at least leave on the fixed level. By inflation means the loss of moneys value. It is measured in an inflation rate the more it raises the more raise the prices for goods and services.

Nowadays, the economy of a country considers as a stable when its rate of inflation doesnt start to grow to the side of increasing that level. A countrys stability and economic growth depend very much on the inflations level.

Leading Indicators
It is a measurable economic indicator that modifies in advanced in the beginning of an economy to tag a special exemplar or trend. Samples of leading indicators contain jobless insurance claims, building permissions, account changes, making workweek and prices of the securities. The Federal Reserve System observes a lot of these indicators as it makes decisions of what to do about the interest rates. There are some concomitant indicators as well, which transform nearly at the same time as the global economy, and retarded indicators, which transform after the general economy, but these are of minimum utilization as prophetical tools. Leading indicators are employed to predict the movements in the economy, but they are not always correct. Connected profits are ordinary a fine leading indicator of the Forex market because traders and investors wait and speculate trends in the economy.