(= Margin Call) The broker's request to add funds or guarantees used to cover exposure to a losing open position.
Simultaneous purchase and sale of the same asset in two different markets in order to take advantage of a momentary quotation. An arbitration may also be carried out by the purchase of an asset concurrently with the sale of another highly correlated asset in order to take advantage of a momentary shift in the correlation between the two assets.
Price at which it is possible to buy an asset.
This statistic size measures the difference between imports and exports from a country. If the trade balance is positive it means that exports are more important than imports. In the case of a trade deficit (negative trade balance) while imports are more important than exports.
Represents the seven most processed currencies in the foreign exchange market. These are the US dollar (USD), the euro (EUR), the yen (JPY), the pound sterling (GBP), the Swiss franc (CHF), the Canadian dollar (CAD) and the Australian dollar (AUD).
European Central Bank (ECB)
Established in 1998, the ECB is the guarantor of the euro area monetary system. It is the Commission that decides in particular the level of interest rates in the euro area.
Internal market to banks and credit institutions on which the latter refinance themselves.
Person who expects a price drop. It is the opposite of a Bull.
Market on which financial institutions (banks, states, central banks, insurers, etc.) finance themselves or place their short-term liquidity. The interbank market is in particular a component of the money market.
Price at which it is possible to sell an asset.
Market Maker (Forex)
operator or institution that arises in return for its customers by continually proposing the supply and demand for each currency pair. It then covers the interbank market.
means a position output that is done without more or less value, that is to say in neutral.
Over the Counter (OTC)
Non-regulated market where the negotiation is carried out directly between the stakeholders. Forex is an OTC market.
When the course passes a higher level of resistance. The term "Breakdown" is used when switching from a downward support.
Abbreviation of gross domestic product. It is used to measure the wealth and growth of a country.
Broker (= broker)
Company allowing individuals and businesses to purchase currencies, ctions, or other financial assets, it is the intermediary. They also say "online broker" or "online brokers".
The Pibor or TIOP 3 months was the arithmetic average of the 3 month rates offered by the 8 largest French banks. It no longer exists since December 31, 1998, it is replaced by the EURIBOR.
Anglo-Saxon Expression designating an increase in a currency, market or title. The appropriate illustration is that of a bull (bull) that loads from the bottom up.
"Price Interest Point". The minimum change unit used on the Forex. On the Euro/Dollar pair, a pip corresponds to 0.0001.
Refers to the GBP/USD currency pair, i.e. pound Sterling versus US Dollar. This term comes from the middle of the 19th century, when the rate was transmitted by a transatlantic cable.
Trends in a course are often punctuated by profit (for bullish) and rebound (for Meadows). These payoffs or rebounds are called retracings, in mathematical language.
This is the name given to an operator in the foreign exchange market. The original definition comes from the word cambiare, which means change in Italian.
Foreign exchange risk
This type of risk is discussed if investments are made in a different currency and the valuation of the currency in which the investment is denominated is depreciated against our reference currency. Example, a European buys American shares in dollar.
Anglo-Saxon term that designates an investment strategy of interest rate arbitration between two currencies. We borrow at low rates to lend at higher rates.
"Roll" a position, that is, to extend it from one deadline to the next. In most Forex brokers, positions are renewed every night, and the parity interest rate differential is credited or debited.
Allows you to view the different interest rates depending on the duration. In theory the longer the rates are, the higher they are, due in particular to a risk premium.
A trading Technique consisting of operating very quickly in order to take advantage of the slightest variation of the course.
Opening and closing one or more positions in the same day, in order to play on very short-term variations (intraday).
Real physical exchange of one currency against another.
Depreciation (of a currency)
When the value of one currency decreases in relation to another, because for example a surplus of currency in circulation or a large budget deficit. The depreciation of a currency will promote exports, as prices will be lower for the purchasing countries. On the other hand, it is the price of imports that will increase.
Being short means betting on the decline of an asset by selling it without actually owning it to redeem it later at a lower price and thus make a profit. Opposite long.
The US dollar is the currency of the United States. There are other dollars around the world, such as the Australian dollar, New Zealand or Canadian.
This is the difference between the course to which we have passed the order and the course that has actually been paid. In a very volatile market, there are sometimes slippage.
Electronic Communication Network (ECN)
Electronic trading systems for OTC markets such as Forex.
This is the difference between the bid and the ask (offer rate and demand rate), counted in number of pips for a currency pair. It is the main source of income for brokers.
European currency unit. Former European currency replaced by the Euro.
Sales order at trigger threshold. Used in active management to limit its losses in case of a drop in the course. For example, if you place a stop loss at 4%, it means that if the price of the title drops by 4%, the title will be automatically sold in order to limit the losses in case the price goes down even lower.
Effect that allows you to take positions for an amount higher than the invested capital. For example on Forex, with an account of 1000 euros and a leverage 100, one can take a position of 100 000 euros.
The level or area on which a course rebound occurs several times (opposite of resistance).
Abbreviation for Euro Overnight Index average. It is a representative interest rate on the day-to-day money market. It is calculated using a weighted average of the transactions established by certain financial institutions, this rate is broadcast by the Banking Federation of the European Union.
(= Currency swap) A contract by which a given amount of currency is exchanged for another. After a given period, the original amounts are rendered.
Euro: This is the single currency of the eurozone countries. It replaced the national currencies on 1 January 2002. (1 euro = 6.55957 French francs).
Swing: Used in the term "swing trading". Short-term portfolio management Technique, aiming for quick returns on values (1 to 3 days).
Term used to refer to countries that are part of the Euro area.
Abbreviation of the "monthly average money market rate", this is the monthly average of the EONIA.
FED (Federal Reserve)
The US Federal Reserve is the central Bank of the United States. It controls the American banking system with the aim of controlling inflation, maintaining interest rates and allowing full employment.
Annual monetary rate.
Abbreviation for "Foreign exchange". In French this indicates the exchange market i.e. the market on which currencies exchange.
Exchange rate between two currencies.
of the financial community of Africa. Currency of African countries that can be used to secure the euro and thus avoid excessive currency fluctuations.
Central bank rates on the money market. They guide the country's monetary policy.
A hedge or hedging is a trade in order to protect another investment, or physical activity, against variations of a foreign currency. For example an industrialist who sells mainly its products in the United States but ensures their production in Europe will have to "hedge" against the variation of this currency pair to avoid any unfavourable movement that could start its margin.
Foreign exchange rates fixed between major international banks. (Interbank rates)
means an annual inflation of more than 100%. Zimbabwe holds the hyperinflation record with inflation of over 100 000% in 2007.
It is the directional evolution of the courses over a given period. A trend may be bullish or bearish. During a flat evolution, there is no trend.
US Premium Rates
US prime rate. The rate at which the US lends to their main corporate clients.
London Interbank offered Rate (LIBOR)
Rate of the British money market.
Long (long position)
Sense of a betting position on the rise of a currency pair.
The size of the minimum transaction at a broker, or on a product type. Generally, a standard currency lot is worth 100 000 units (€, $, £,…), a mini-lot is worth 10 000 units and a micro-lot is worth 1000 units.