Forex Glossary of Trading Terms and Definitions

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Welcome to our Forex Glossary, a complete trading dictionary designed to clarify essential forex terms and concepts for traders of all levels. From basics like "pip" and "leverage" to advanced ideas like "carry trade" and "market makers," it covers key players, trading strategies, risk management, and analysis methods. This resource helps you build confidence and make smarter trading decisions by mastering the language of the forex market. Happy trading!

Browse the glossary using this index

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I

Ichimoku

Ichimoku Kinko Hyo, often simply referred to as Ichimoku, is a comprehensive technical analysis indicator used in trading to assess momentum, support, and resistance levels. It consists of five main components: Tenkan-sen (conversion line), Kijun-sen (base line), Senkou Span A and B (leading spans), and Chikou Span (lagging line). The combination of these lines provides insights into market trends and potential reversal points, allowing traders to make informed decisions regarding entry and exit points in various financial markets.

Index

An index, in finance, is a statistical measure that represents the performance of a specific group of assets, typically securities, stocks, or bonds, and serves as a benchmark for evaluating investment performance. Commonly known examples include the S&P 500, which tracks 500 large-cap U.S. stocks, and the Dow Jones Industrial Average, which includes 30 major American companies. Indexes can be price-weighted, market-cap weighted, or equal-weighted and are used by investors to gauge market trends, compare investment returns, and make informed decisions about asset allocation and diversification. Additionally, indexes can also represent broader economic indicators and serve as the basis for various financial products, such as index funds and exchange-traded funds (ETFs).