Every possible forex trading term explained; From Basics terms to mainstream Slangs

5min read of 50+ forex terms & slangs explained simply with each a sentence long

Photo by Markus Winkler on Unsplash

I've been a Forex trader for years and can boldly say I've known my way on trading in and out and have consistent profits to stamp that statement. Or so I thought, up until I saw a financial news reports talking about “Ninja Rallying..” and I was like what, it sounded like a scene from an upcoming Jackie Chan movie. But, in fact, Ninja was a nickname for the USD/JPY currency pair that you probably didn’t know about.

So that’s why I’ll be decoding the most common terms used in forex trading in an attempt to speed up your understanding of the world of currencies, and so Bloomberg news reporters will no longer sound alien to you like they did for me. I didn’t need to necessarily know these terms before hand because i felt it was filler information. I’ve always just been saying USD/JPY and everyone can understand me, but still it’s still fun to know the various forex trading terms you never knew existed and you can also use it to sound smarter than you already are lol..let’s dive in.

CURRENCY NICKNAMES(basics)

Single currency — EUR (Euro)

Loonie — CAD (Canadian dollar)

Swissie — CHF (Swiss franc)

Aussie — AUD (Australlian dollar)

Kiwi — NZD (New Zealand dollar)

Greenback, Buck — USD (U.S. dollar)

Sterling, Pound sterling — GBP (British pound)

CURRENCY PAIRS

Cable — GBP/USD (British pound / U.S. dollar)

Ninja—USD/JPY (U.S. dollar Japanese yen)

Fiber — EUR/USD (Euro / U.S. dollar)

Chunnel— EUR/GBP (Euro / British pound)

Yuppy— EUR/JPY (Euro / Japanese yen)

Guppy or Gopher —GBP/JPY (British pound / Japanese yen)

Barnie—USD/RUB (U.S. dollar /Russian Ruble)

COMMON TERMS

QE — Quantitative Easing is the central bank’s monetary policy to print and inject more money into the economy

A central bank creates fake digital money to buy back its own bonds from regular banks so those banks have more cash to lend to everyday people.

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Hawkish and Dovish statements — Central bank announcements that usually increases hint at interest rate (Hawkish) or cuts (Dovish)

Yard — A billion units of any currency.

Thin market — A condition when prices are not as liquid as expected

Speculator— Individual trader taking large risks in the hope of making a quick gain {We all have that 'speculator' in our friend group}

Uptick — A new price quote at a price higher than the preceding quote

Rate hike — An interest rate rise

Surge — A very quick and sudden price movement in an upward direction

Plunge — A very quick and sudden price movement in a downward direction

Whipsaw — Highly volatile market with sharp price movements, usually consolidating

Safe haven assets— Currencies, commodities or bonds that rise during periods of high uncertainty such as Gold

Commodity currency — A currency that is based on a commodity export economy. For example, Australian dollar (exporting minerals), Canadian dollar (exporting oil), New Zealand dollar (exporting dairy and meat)

POPULAR PHRASES

Babysitting a trade — Holding a losing trade open for a long time

Position trading — betting on long-term gains by keeping a position open for several months to years, without being too concerned with short term price movements

Hedging — Maintaining a position that reduces the risk of your primary position

Currency rallying — A price that recovers after a period of its decline.

Plunging— A price that’s sinking or falling from it’s previous value.

Keep the powder dry — Limiting your trades until trading conditions become clearer.

Getting whacked —Losing against a swift, sharp trade.

Melting account —Making losses too large to continue trading.

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