TERMS AND LANGUAGES OF FOREX

First let us get used to the terms and languages as being used by the pros in forex trading.
You get to hear things like Pairs; Base/counter currency; Bull/Bear;Pips; Margin; Spread; Leverage etc.
Currencies are traded in pairs like USD/JPY which means the US dollar/ the Japanese Yen. The USD being the Base currency here while the Japanese Yen is the counter currency.
When you hear the pros say it's Bull, that means the base currency is strong and at this point a trader buys but when they say it's bear, then that means the counter currency is stronger and this is when a trader sells.
A pip is an acronym for Price Interest Point which is the movement of the price of any pair from a point to another it equally determines the volume of your profit or loss and your mean goal is to gain as many pips as the market permits you.
Margin is the amount of money a trader invested in the Forex trading, it's a sort of bond to ensure against total loss of his/her deposit.
Spread is the difference between the BID and the ASK price and this is the token fee being charged by the broker.
Leverage is the amount of money your broker loans to you, it give a trader the ability to control a bigger trade with your little money. Any market movement will have an equally proportional effect on your deposited fund. See you in the next lesson.