FOREX & ECONOMY GLOSSARY

1. FOREX GLOSSARY: 

TRADE SIZE: The number of units of product in a contract or lot. 

TRAILING STOP: A trailing stop allows a trade to continue to gain in value when the market price moves in a favorable direction, but automatically closes the trade if the market price suddenly moves in an unfavorable direction by a specified distance. Placing contingent orders may not necessarily limit your losses.

TREND: Price movement that produces a net change in value. An uptrend is identified by higher highs and higher lows. A downtrend is identified by lower highs and lower lows. 

BAR CHART: A type of chart which consists of four significant points: the high and the low prices, which form the vertical bar, the opening price, which is marked with a little horizontal line to the left of the bar and the closing price, which is marked with a little horizontal line to the right of the bar. 

ASK PRICE: The price at which the market is prepared to sell a product. 

BID PRICE: The price at which the market is prepared to buy a product.

BID/ASK SPREAD: The difference between the Bid and the Ask price. 

2. ECONOMY GLOSSARY: 

FISCAL POLICY is Government spending policies that influence macroeconomic conditions. Through fiscal policy, regulators attempt to improve unemployment rates, control inflation, stabilize business cycles and influence interest rates in an effort to control the economy. Fiscal policy is largely based on the ideas of British economist John Maynard Keynes (1883–1946) who believed governments could change economic performance by adjusting tax rates and government spending. 

ECONOMICS is a social science that studies how individuals, governments, firms and nations make choices on allocating scarce resources to satisfy their unlimited wants. Economics can generally be broken down into: macroeconomics, which concentrates on the behavior of the aggregate economy; and microeconomics, which focuses on individual consumers. Economics is often referred to as "The Dismal Science". 

FEDERAL RESERVE BOARD is the governing body of the Federal Reserve System. The seven members of the board of governors are appointed by the president, subject to confirmation by the Senate.  The board sets Fed policy regarding the discount rate and reserve requirements (among other key economic decisions), the chairman of the board of governors is also the chairman of the Federal Reserve Open Market Committee (FOMC).