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Arbitrage

Taking advantage of different prices of an asset in two markets is called arbitrage. For example, buying an asset for 100 dollars in market A and selling it for 105 dollars in market B.

Ask

it is the highest price at which a trader is willing to pay to buy a particular asset or currency.

Asset

it refers to something valuable, such as a currency.

Averaging down

When a trader buys an asset, the price reduces, and if the trader buys more, the price drops even more. This is known as averaging down.

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Base Currency

The first currency of any currency pair is called the base currency. for example, the USD is the base currency in this currency pair: USD/EUR

Bear

Traders that believe a market, asset, or financial instrument is moving down are known as bears.

Bear Market

It describes a situation in which a market is experiencing price declines.

Bid

It is the lowest price at which a trader is willing to sell a particular asset or currency.

Bond

Bonds are a type of financial investment in which you lend money to a company for a set length of time. Depending on the type of institution you are lending to, they normally come in two varieties: corporate bonds and government bonds.

Bull

Bulls are investors who believe that the value of a market, instrument, or sector will rise in the future.

Bull Market

It describes a situation in which a market is experiencing increasing prices.

Buy Limit Order

it is an order to buy an asset or currency at or lower than a specific price level and it helps traders to control the amount of money they pay to buy something.

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Carry Trade

it is a trading strategy in which a trader borrows an amount of money with a low-interest rate and invests that money in an asset that provides a high rate of return.

Closed Position

A trade that is no longer active and its profits or losses are realized.

Closing Market Rate

the final value of a currency or an asset at the end of a specific time frame (usually regular market hours)

Closing Price

This is the final price at which an asset was traded on a given day.

Commission

The fee that an investment broker charges for making trades on behalf of a client is known as commission.

Commodity

A commodity is a fundamental physical asset that is frequently used as a raw material in manufacturing goods or services.

Currency Appreciation

an increase in the value of a currency compared to another one.

Currency Futures

these contracts specify the price of a currency for a predetermined date in future.

Currency Pair

a currency pair is what’s being traded within any forex transaction, and it includes two different currencies; the first one is called the base currency, and the second one is called quote currency. For example: USD/EUR

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Daily Chart

A diagram that analyzes the price movements of a specific asset for the period of one working day.

Day Trade

A trade that is opened and closed on the same day.

Demo Account

A forex trading account that is virtual and works with virtual money. Novice traders can use it to explore the market and become familiar with the environment of a forex market.

Depth of Market

it represents the volume of bids and asks of a currency or an asset at the current best prices.

Drawdown

after a currency plunges, the gap between the peak and the new low level is called drawdown.