Trading Model
A rule-based structure created to govern trading activity, helping take guesswork out of the markets while encouraging traders to set risk parameters.
Related terms
Models
Synonymous with ‘black box’: systems that automatically buy and sell based on technical analysis or other quantitative algorithms.
Read full definitionForex Signal System
A set of analyses based on charting tools, technical analysis or news events that traders use to decide whether to buy or sell a currency pair. Systems can be manual, with the trader interpreting signals, or automated, with software taught to find and interpret them.
Read full definitionRisk Management
The employment of financial analysis and trading techniques, such as attaching stops and limits, to reduce and control exposure to various types of risk.
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Aggressive
A description of traders and/or price action acting with conviction.
Read full definitionArbitrage
The simultaneous buying and selling of the same currency in different markets to profit from small price differences. The strategy exploits temporary inefficiencies in FX markets.
Read full definitionAt Best
An instruction given to a dealer to buy or sell at the best rate that can be obtained at a specific time.
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An instruction given to a dealer to buy or sell at a specific price or better.
Read full definitionBroker
A third party coordinating the sale of financial securities between sellers and buyers. Exchanges only accept orders from their members, so traders and investors use brokers as intermediaries; brokers are compensated through commissions, fees or payment from the exchange.
Read full definitionBulls
Traders who expect prices to rise and who may be holding long positions.
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