Glossary
Fibonacci Retracement
Fibonacci retracement uses horizontal lines to indicate areas of support or resistance at key Fibonacci levels before price continues in the original direction.
Forex (Foreign Exchange)
Forex is the global decentralized market for trading currencies. It is the largest financial market in the world with a daily volume exceeding $7.5 trillion.
Fundamental Analysis
Fundamental analysis evaluates currencies and assets by examining economic indicators, central bank policies, and macroeconomic factors to determine intrinsic value.
Gap
A gap is a price level where no trading occurred, creating a visible jump on a chart. Common at market open or after major news events.
Good Till Cancelled (GTC)
GTC is an order duration that keeps a pending order active until it is filled or manually cancelled by the trader.
Hedging
Hedging is a risk management strategy that opens an opposing position to offset potential losses from an existing trade.
High Frequency Trading (HFT)
HFT uses powerful computers to execute thousands of trades per second, exploiting tiny price differences. Primarily used by institutional traders.
Inflation
Inflation is the rate at which the general price level of goods and services rises, eroding purchasing power. A key driver of currency value and interest rate policy.
Interest Rate
Interest rates set by central banks are the most powerful driver of currency values. Rate changes affect capital flows, inflation, and economic growth.
Leverage
Leverage allows traders to control large positions with small capital. Expressed as a ratio (e.g., 1: 100), it amplifies both profits and losses.