Glossary of terms

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  • Daytrading

    The investment strategy focusing on opening and closing positions on the same day. This trading  technique is very popular among the participants of the Forex market because of the high daily volatility of exchange rates.

  • Declining triangle

    The formation consists of two lines, the upper is the bearish and the lower is horizontal. The breakdown should take place through the bottom edge, often with an adjustment movement and no later than 25% before the end of the formation, starting from the beginning. 

  • Deficit

    A deficiency in the trade balance, current account or the budget of the government.

  • Deflation

    This is the opposite of inflation. Decrease in prices of the basket of goods and services. Deflation occurs when the inflation rate falls below zero. This may take place after reduction of the money supply and/or credit.

  • Depression

    A simple definition of depression is that it is a large-scale recession that lasts for a longer period. Some define depression as a scenario in which real GDP falls by at least 10%. Another way to distinguish depression from a recession is its duration. Recessions are to last for one year, while depressions can last for several years. The term "depression" is derived from the great recession of the 30s of the twentieth century. Later, the term recession began to be applied to small decreases in the economic activity and depression was used to call a major slowdown.

  • Derivatives

    A derivative financial instrument whose value depends on the value of the underlying instrument. The underlying instrument can be e.g. shares, bonds, interest rate or even rainfall – as weather derivatives.

  • Diversification

    Investing in different markets in order to reduce the risk.

  • Double bottom

    A formation used in the technical analysis. It is characterized by a strong decline in prices after which prices bounce up to soon fall back to the level set in the first drop and bounce up strongly. In the chart, the formation looks like the letter "W" and promises a trend reversal.

  • Double peak

    A double price pattern used in the technical analysis foreshadowing a trend reversal. The formation is determined by two price peaks formed at the same level and separated by a clear decline in prices. This formation on the chart creates a shape resembling the letter "M".