Devaluation is the intentional reduction of a country’s currency value relative to other currencies. This is typically carried out by its government or central bank. This is different from depreciation, which occurs due to market forces. Devaluation is usually done in a fixed or managed exchange rate system. In these systems, the currency’s value is…
Day trading is a trading strategy where traders buy and sell financial assets within the same day, aiming to profit from short-term price movements. Unlike long-term investors, day traders do not hold positions overnight, as they seek to take advantage of small fluctuations in price during market hours. This approach is common in markets like…
A currency pair is the quotation of two different currencies in the Forex market. It shows how much of one currency is needed to buy one unit of the other. Currency pairs are always written in a specific format, with the base currency listed first and the quote currency (or counter currency) listed second. For…
The Commodity Channel Index (CCI) is a technical indicator used to measure the strength and direction of a price trend. Despite its name, the CCI is not just for commodities—it is widely used in Forex, and other financial markets. The indicator compares an asset’s current price to its average price over a set period, helping…
A closing order is a trade instruction used to exit an open position in the financial markets. When a trader closes an order, they are finalizing the trade by selling an asset they previously bought or buying back an asset they previously sold. This action locks in any profits or losses from the trade. Closing…
CFDs, or Contracts for Difference, are financial instruments that allow traders to speculate on the price movements of various assets without actually owning them. These assets can include stocks, indices, commodities, currencies, and more. When trading a CFD, you are entering into a contract with a broker to exchange the difference in the price of…
A carry trade is a trading strategy where a trader borrows money in a currency with a low interest rate and uses that money to buy a currency with a higher interest rate. The goal is to earn a profit from the difference between the two interest rates, known as the interest rate differential. In…
A Candlestick Chart is a popular type of financial chart used by traders to analyze price movements of assets like stocks, currencies, or commodities. Each “candlestick” on the chart represents the price action for a specific period of time, such as one minute, one hour, or one day. The candlestick shows four key pieces of…
A bull market is a term used to describe a financial market where prices are rising over a period of time. It usually refers to a steady increase of 20% or more in the price of stocks, currencies, commodities, or other financial assets. A bull market reflects positive sentiment among investors and traders, often driven…