Futures and Forex Glossary Dictionary S3By scorpion
Published: September 23, 2009
When the central bank retracts the money supply to increase the price of money. See Also: Monetary Policy
A market that is large enough to accommodate heavy trading without too big swings. An example would be the EUR/USD forex market.
When the central bank makes a foreign exchange intervention but offsets the change to the monetary base by selling or buying domestic assets.
When the central bank makes a foreign exchange intervention but offsets the change to the monetary base by selling or buying domestic assets. The bank may issue new securities for example to increase the money supply after domestic currency has been used to buy foreign currency.
Slang term used for the British Pound (GBP).
An oscillator used in technical analysis to predict future prices, by applying statistical models.
A bank or other financial institution that trades stocks and other securities on the market for its clients.
Slang term used by traders for the Swedish Krone (SEK).
Stop Loss Order
A limit order set with a limit under the current market price (for a long position) or over the current market price (for a short position). If the price reaches the limit, the stop loss order is activated and the security is either sold or bought to prevent further loss. See Also: Limit Order
Stop Loss Strategy
A strategy that involves using stop loss limit orders where a position is closed should it reach a certain level. Stop loss orders are used conservatively to limit risk. See Also: Stop Loss Order
A limit order set with a limit under the current market price (for a long position) or over the current market price (for a short position). If the price reaches the limit, the stop loss order is activated and the security is either sold or bought to prevent further loss.
An order to buy or sell at a given price if reached.
An order to buy a given price if reached.
Stop Loss Hunting
Strategy used by rogue brokers to increase profit. If the broker sees that a client has a stop loss order, they may increase the spread to trigger the stop loss unfairly. See Also: Stop Loss Order
Option strategy where the trader holds both a call and put option for the same underlying asset with the same expiration date and strike price. This strategy is used if the trader expects big price movements but is unsure of in which direction the price will go.
Straight Trough Processing (STP)
Proposed initiative to speed up the transfer of forex to eventually same day delivery by allowing electronic data to be passed on without manual control.
See Straddle. The strangle is a similar strategy but both the call and put option is far out of the money.
The price at which an option can be exercised. For a call option this means the price at which the underlying asset can be bought. For a call option this means the price at which the underlying asset can be sold. See Also: Option
An additional client account with a broker that may for example be denominated in another currency.
A price level where there is significant buying pressure. The price may drop to this level but will have difficulty dropping below. See Also: Resistance Levels
A transaction to move the settlement date of a forex spot transaction. See Also: Rollover Rate
An internationally recognized code used to identify banks in forex transactions.
Swiss Franc (CHF)
The currency of Switzerland.
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