The Complete Forex Trading Glossary

A forex broker execution model (STP/ECN) that passes client orders directly to external liquidity providers without taking the opposing side of the trade.

The simultaneous purchase and sale of an asset in different markets or synthetic combinations to exploit temporary pricing discrepancies for risk-free profit.

A bullish continuation chart pattern characterized by a horizontal resistance level and an ascending lower support trendline indicating increasing buying pressure.

The market price at which a trader can buy a currency pair or financial instrument (the price the broker/seller is willing to accept).

A technical indicator created by J. Welles Wilder measuring market volatility by averaging the true price range over a specified number of periods.

A broker execution model where the brokerage acts as the counterparty to client trades, taking internal market risk on client losses and gains.

The first currency quoted in a currency pair. In EUR/USD, the Euro is the base currency, and the quote represents how much USD is needed to buy 1 EUR.

A bearish continuation pattern consisting of a sharp downward flagpole followed by a shallow upward-sloping consolidation channel before trend resumption.

A market condition or trader sentiment characterized by falling prices and expectations of further downward movement.

The market price at which a trader can sell a currency pair (the highest price a buyer in the market is currently willing to pay).

A volatility indicator created by John Bollinger consisting of a simple moving average and two standard deviation bands that expand and contract with volatility.

When price moves decisively through an established support or resistance level, trendline, or chart boundary, often accompanied by rising volume.

A bullish continuation pattern featuring a steep upward impulse flagpole followed by a downward-sloping consolidation channel before another upward explosion.

A market condition or trader sentiment characterized by rising prices and the expectation of continuing upward trajectory.

A visual chart unit displaying Open, High, Low, and Close (OHLC) prices for a specific time period, indicating the battle between buyers and sellers.

A financial strategy where an investor borrows money in a low-interest currency to invest in a high-interest currency, capturing the positive interest rate spread.

A national institution responsible for managing a nation's currency, money supply, interest rates, and monetary policy (e.g., Federal Reserve, ECB, BOJ, BOE).

In Smart Money Concepts, a structural shift where price breaches the most recent major swing point contrary to the prevailing trend, signaling a reversal.

A price phase where an asset trades within a defined horizontal range without a clear directional trend, reflecting market equilibrium and indecision.

A currency pair that does not include the US Dollar as either the base or quote currency (e.g., EUR/GBP, AUD/NZD, EUR/JPY).

The quotation of two different currencies relative to each other, representing how much quote currency is required to purchase one unit of the base currency.

A trading style where positions are opened and closed within the same trading day, avoiding overnight swap fees and gap risk.

A bearish technical chart pattern where a short-term moving average (commonly the 50 EMA/SMA) crosses below a long-term moving average (commonly the 200 EMA/SMA).

A simulated trading account funded with virtual capital that mirrors real live market conditions for practice, strategy validation, and platform familiarity.