Glossary N to S
NASDAQ – The National Association of Securities Dealers Automated Quotation. NASDAQ is an acronym for the largest electronic screen-based equity securities market in the United States. An Index of over 5,000 company listings, it trades on average more shares per day than any other US stock market. The UK stock market index equivalent is the FTSE.
Open Order
An order that will be executed when a market moves to its designated price. Normally associated with Good Till Cancelled Orders.
Open Position (Trade) – The purchase of a security or currency pair or the short sale of a security or currency pair to open a position.
Order – The request made by a customer for a broker to buy or sell the currency with a certain rate or at Market Price.
Overnight
Pivot Point – The primary support or resistance level calculated basing on the previous trend’s High, Low and Close prices.
Pip – The smallest price change that any given exchange rate can make. Since most major currency pairs are priced to four decimal places, the smallest change is that of the last decimal point – for most pairs this is the equivalent of 1/100th of one percent, or one basis point. (i.e. 1 pip = 0.0001).
Profit – The amount of money gained when a position is closed.
Pip Spread
The pip difference between the Bid and Ask price. Typically 3 or more pips, varying also by currency pairs. Some brokers offer fixed spreads; others will change the spread (variable spread) depending on market activity.
Pip Value
If the USD is the base currency, one pip is worth $10 for a standard lot ($100,000) trade and $1 for a mini lot of $10,000. Some brokers offer even smaller lots and a pip will of course be worth less. For other base currencies such as for the GBP/USD or EUR/JPY pairs, a pip will have a different base currency value if converted back to dollars. See Lot Size.
Quote Currency :
The second currency quoted in a currency pair within the Forex Market. In a direct quote, the quote currency is the foreign currency. In an indirect quote, the quote currency is the domestic currency. The quote currency is also known as the “secondary currency” or “counter currency”.
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Realized Profit/Loss
The gain or loss for a closed position after spreads and commissions have been paid.
Resistance
In technical analysis, the price level at which a security or currency or an entire market can trade up towards, but not exceed, for a certain period of time. Often referred to as the “resistance level”. The resistance level is a key trend marker and when reached, often is met with heavy selling which drives the position lower.
Resistance
A term used in technical analysis, this is a forecast price level where the rate of exchange should encounter selling pressure, which should stop the price/rate from rising any further. Main market participants including investment funds and banks, look for resistance and support levels to place orders and thus they become, to a large degree, self-fulfilling prophecies. See also Support.
Settled Position
closed positions for which all needed transactions has been made.
Slippage
The execution of an order at a price that is different than expected, the main reasons for slippage are – “fast” market, low liquidity and the broker’s inability to execute orders rapidly.
Spread
The difference between the bid and ask prices for a currency pair.