Long Term Trading
Trading positions that last from a week up to few months. Long term trading is considered as an investing strategy. Long term traders usually base their trades on fundamental analysis, high capital amounts and very low leverage.
Loop Order
A Loop Order is a perpetual or repeating order placed in anticipation of a cyclical movement in the market. It is a pair of matching orders where the first leg is active and the second dormant. When the desired price is reached for the active order, it is executed, the dormant order becomes active, and […]
Lot
The standard trading unit that traders transact. Micro Lot – The smallest tradable lot size: 1,000 units of the currency. Mini Lot – A smaller lot size: 10,000 units of the currency. Standard Lot – 100,000 units of the currency. Nano lot = 0.001 of a lot = 100 base units ($100 if the account […]
MACD (Moving Average Convergence/Divergence)
A technical indicator that measures an average of the average prices (The average between EMA and SMA) over different periods of time. MACD helps to determine trends.
Major and Minor Currencies
The seven currencies that are traded most often are also referred to as major currencies. They include the EUR, USD, JPY, GBP, AUD, CAD and CHF. All other currencies are referred to as minor currencies. The most frequently traded minors are the New Zealand Dollar (NZD), the South African Rand (ZAR) and the Singapore Dollar […]
Marabuzo
A common type of candlestick characterized by a full body, with no shadows.
Margin
The amount of money needed to maintain a position. Each time the trader executes a new trade, a certain percentage of the account balance in the margin account will be earmarked as the initial margin requirement for the new trade based upon the underlying currency pair, its current price, and the number of units traded […]
Margin Call
If the funds available on a trading account are insufficient to cover the losses of open positions, the broker makes a margin call. If the broker hasn’t defined a stop out level, it will automatically close out all or part of the open positions. If the broker has defined a stop out level, the margin […]
Market Maker
A dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial instrument.
Market Risk
The chance for future price changes in the market’s currency