Appreciation - A currency 'appreciates' when it strengthens in price with respect to market demand.

Arbitrage - The purchase or sale of an instrument and simultaneous taking of an equal and opposite position in a related market to take advantage of the price differentials.

Bear Market - A market distinguished by declining prices.

Bid/Ask Spread - Difference between the bid and offer price, and the most widely used measure of market liquidity.

Book - The summary of a trader's or desk's total positions.

Contagion - The tendency of an economic crisis to spread from one market to another.

Commission - A transaction fee charged by a broker.

Day Trading - Refers to positions which are opened and closed on the same trading day.

Dealer - An individual who acts as a principal or counterpart to a transaction.

Deficit - A negative balance of trade or payments.

Economic Indicator - A government issued statistic that indicates current economic growth and stability like employment rates, Gross Domestic Product (GDP), inflation, retail sales, etc.

EURO - The currency of the European Monetary Union (EMU), a replacement for the European Currency Unit (ECU).

Federal Deposit Insurance Corporation (FDIC) - The regulatory agency responsible for administering bank depository insurance in the US.

Federal Reserve (Fed) - The Central Bank for the United States.

Flat/Square - Dealer jargon describing a position that has been completely reversed, thereby creating a neutral (flat) position.

Good 'Til Canceled Order (GTC) - An order to buy or sell at a specified price. The order remains open until filled or until the client cancels.

Hedge - A position/positions that reduces the risk of your primary position.

Initial Margin - The initial deposit of collateral required to enter a position as a guarantee on future performance.

Leading Indicators - Statistics that predict future economic activity.

LIBOR - The London Inter-Bank Offered Rate; used by other banks when borrowing from another bank.

Margin call - A request from a broker or dealer for additional funds or other collateral to guarantee performance on a position moves against the customer.

Market Maker - A dealer who regularly quotes both bid and ask prices and is ready to make a 2-sided market for any financial instrument.

Offer - Rate at which a dealer is willing to sell a currency.

Offsetting Transaction - A trade which serves to cancel or offset some or all of the market risk of an open position.

Pips - Digits added to or subtracted from the 4th decimal place. Also called Points.

Political Risk - Exposure to changes in governmental policy which affects an investor adversely.

Position - The netted total holdings of a given currency.

Quote - An indicative market price, normally used for information purposes only.

Rate - The price of one currency in terms of another, typically used for dealing purposes.

Resistance - A term used in technical analysis indicating a specific price level at which people will sell.

Settlement - The process by which a trade is entered into the books and records of the counterparts to a transaction. It may or may not involve the actual physical exchange of one currency for another.

Short Position - An investment position that benefits from a decline in market price.

Technical Analysis - An effort to forecast prices by analyzing market data, like price trends, averages, volumes, open interest, etc.

Tomorrow Next (Tom/Next) - Buying and selling of a currency for delivery the following day.

Uptick - A new price quote at a price higher than the preceding quote.

Variation Margin - Funds a broker must request from the client to have the required margin deposited.

Whipsaw - Slang for a highly volatile market where a sharp price movement is quickly followed by a sharp reversal.

Yard - Slang for a billion.

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