Below You will find all essential definitions You should know

Ask
The price at which sellers are willing to sell a currency pair, also known as the 'offer', 'ask price', and 'ask rate'.

Candlestick Chart
A chart that displays the trading price range (open, high, low and close). A form of Japanese charting that has become popular in the West. A narrow line (shadow) shows the day's price range. A wider body marks the area between the open and the close. If the close is above the open, the body is white (not filled); if the close is below the open, the body is black (filled).

Carry (Interest-Rate Carry)
The income or cost associated with keeping a foreign exchange position overnight. This is derived when the currency pairs in the position have different interest rates for the same period of time.

Bank Rate
The rate at which a central bank is prepared to lend money to its domestic banking system.

Base Currency
In terms of foreign exchange trading, currencies are quoted in terms of a currency pair. The first currency in the pair is the base currency. The base currency is the currency against which exchange rates are generally quoted in a given country. Examples: USD/JPY, the US Dollar is the base currency; EUR/USD, the EURO is the base currency.

Bid
The price at which an investor can place an order to buy a currency pair; the quoted price where an investor can sell a currency pair. This is also known as the 'bid price' and 'bid rate'.

Bid/Ask Spread
The point difference between the bid and offer (ask) price.

Broker
An agent, who executes orders to buy and sell currencies and related instruments either for a commission or on a spread. Brokers are agents working on commission and not principals or agents acting on their own account. In the foreign exchange market brokers tend to act as intermediaries between banks bringing buyers and sellers together for a commission paid by the initiator or by both parties. There are four or five major global brokers operating through subsidiaries affiliates and partners in many countries.

Buy Limit Order
An order to execute a transaction at a specified price (the limit) or lower.

Drawdown
The size of a drop in the value of an account from its peak to its low.

Equity
Total assets minus total liabilities; also called net worth.

Forex
Acronym for Foreign Exchange.

Hedge
A term used to describe reducing risk associated with adverse market movements by using two counterbalancing investments, thereby minimizing any losses caused by price fluctuations.

Leverage
The ratio of margin to the maximum position size. With a deposit of $5000 and a leverage of 50, a trader could enter a position with a face value of $250,000.

Long
When a currency pair is long, the first currency is bought while the second currency is sold short. To go long on a currency means that you buy it.

Margin
The minimum deposit required to maintain an open position. For example, with an open position of $250,000 and a leverage of 50, the required margin would be $5000.

Pip
The smallest upward or downward price movements quoted in forex. In EUR/USD, a movement of 0.0001 is one pip (for example, from 140.005 to 140.004 euro). In USD/JPY, a movement of 0.01 is one pip (for example, from 116.32 to 116.31 yen).

Range
The difference between the highest and lowest price of a currency pair during a given trading period. 

Sell Limit Order
An order to execute a transaction only at a specified price (the limit) or higher. 

Sell Stop      
A limit order with a limit placed below the current market price. Once triggered, the limit order becomes a market order.

Short
Selling a currency pair that involves being short the base currency and long the quote currency.

Spot Foreign Exchange
Often referred to as the "interbank" market. Refers to currencies traded between two counterparties, often major banks.  Spot Foreign Exchange is generally traded on margin and is the primary market that this website is focused on.  Generally more liquid and widely traded than currency futures, particularly by institutions and professional money managers.

Stop Loss Order      
Order to buy or sell when a given price is reached or passed to liquidate part or all of an existing position. 

Take Profit Order
A customer's instructions to buy or sell a currency pair which, when executed, will result in the reduction in the size of the existing position and show a profit on said position.