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Home > Question of the Day

What is a stop order?

A stop order (also stop loss order) is an order to sell (or buy) a security once the price of the security has climbed above (or dropped below) a... read more »

What is a limit order?

A limit order is an order where you specify the price at which you would like your trade to execute.  This means that the order is directly affected... read more »

What Is RSI?

The RSI or Relative strength Index is a momentum oscillator that measures the speed and change of price movements. RSI oscillates between 0 and 100.... read more »

What is the “spot market”?

The spot market or cash market is a public financial market, in which financial instruments or commodities are traded for immediate delivery. It... read more »

What is the most important data point for the forex market?

While difficult to pick just one, the US Non-Farm Payrolls report is one of the most followed numbers in all markets around the globe.  This is... read more »

Why Do Countries Want A Weak Currency?

For the most part, governments want to have a weak currency to help encourage their exports.  The weaker a currency is, the more attractive that... read more »

Why is gold considered a “safe-haven”?

Gold is considered a safe-haven asset as throughout history it has been viewed as a store of value.  It is essentially a currency that cannot be... read more »

What would a credit downgrade mean for the US?

Great question, as the effects at this point are unknown.  There are a few schools of thought on the matter so when or if this happens will be... read more »

What Is Volatility?

Volatility is a measure for variation of price of a financial instrument over time.  Historic volatility is derived from time series of past market... read more »

How Do Interest Rates Affect Currencies?

Interest rates are one of the most important fundamental factors that influence the value of a currency.  The higher the interest rate, the more... read more »

What is a Central Bank?

A central bank, reserve bank, or monetary authority is a public institution that usually issues the currency, regulates the money supply, and... read more »

What is a Stop-Loss Order?

A stop-loss order is an order that is intended to take you out of a trade when price moves opposite to the expectation.  While usually intended to... read more »

How does CPI data affect a currency?

Generally speaking, CPI data measures inflation in an economy.  When inflation gets too high in a country, the Central bank may increase interest... read more »

What is a “Bond Vigilante”?

A bond vigilante is a bond market investor who protests monetary or fiscal policies they consider inflationary or risky by selling bonds, thus... read more »

When is the forex market open for trading?

It is a common misconception that the forex market is open for trading "24/7", when in fact it is more like "24/5".  Th emarket closes for the... read more »

What is Risk-Aversion?

Risk aversion is a market theme that occurs when investors are not confident about the economic climate and will give up potential higher yielding... read more »

What is a “Dead-Cat Bounce”?

A Dead-cat bounce is a Wall Street term that refers to a small, brief recovery in the price of a declining asset such as a stock, bond, or currency... read more »

What is a currency intervention?

A currency intervention occurs when a Central Banks takes actions to influence the value of their currency, typically to weaken it. They can do this... read more »

What is GDP?

GDP or Gross Domestic Product is a measure of a country’s economic output. It is derived by adding up: private consumption, gross investment,... read more »

What is a safe-haven currency?

A safe-haven currency is one that is perceived by the markets to be a store of value. In times of extreme risk aversion, currencies like the Swiss... read more »

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