Your Quick Guide to Key Trading Terms

Trading involves unique terminology that can feel overwhelming for beginners. Trader Market’s glossary simplifies the jargon, providing clear definitions to enhance your understanding of the markets.

Essential Terms:

1. Pip:
   • The smallest price movement in a currency pair, typically the fourth decimal place.
2. Leverage:
   • A tool that allows traders to control larger positions with a smaller amount of capital.
3. Spread:
   • The difference between the bid (buy) and ask (sell) prices of an asset.
4. Lot:
   • A standardized unit of trading in forex, with one standard lot equaling 100,000 units of currency.
5. Stop-Loss:
   • An order placed to close a trade automatically when it reaches a certain loss level.

Advanced Terms:

• Fibonacci Retracement:
  • A tool used to identify potential reversal levels based on Fibonacci ratios.
• Volatility:
  • A measure of price fluctuations within a market or asset.
• Margin Call:
  • A broker’s demand for additional funds when an account falls below the required margin level.

Our comprehensive glossary covers everything from basic concepts to advanced strategies, ensuring you have the knowledge to trade effectively.