Average True Range (ATR)
This is an indicator of the technical analysis to find out the market volatility. Based on the dividing the range of asset prices during the period. The main indicator of the true range is the maximum index of:
- current high minus current low;
- the absolute expense of the current maximum is less than the preceding close;
- the absolute value of the current minimum minus the preceding close.
Stop-Loss vs Stop-Limit
Traders and investors usually use particular types of orders to minimize potential loss, roll them over on the market, when they cannot do it manually. Stop-loss stop grab are these two tools helping investors and dealers to perform this task.
When your stop-loss hits the marketplace and falls into big spread pairs, you pay a significant spread. This can make a template that will merge all the stops under or over it. The more stops are hit, the greater the price transformation will be. This can even lead to tampering caused by a stop grab.
The concept of correlation is used in Forex to denote the dependency of cash pairs movement. Knowing the direct or inverse interaction between contrasting pairs, a seller can foresee the rise of one and the fall or rise of the other, not forgetting about the time gap.
The correlation in Forex can be parallel (positive) and mirror (negative). With a parallel correlation, a boost in the cost of one cash set activates a boost in another and vice versa. With a mirror correlation, the growth of one cash pair leads to a decrease in another.
If currency pairs move in one direction and with a littlest time gap, the correlation will tend to 100%. If the cash pairs go in different ways, the quotient will be -100%. It ought be noted that the closer the correlation index to 0, the more diminished the interaction between the cash pairs is.
The bigger the value of the spread, the bigger the liquidity of the market is. When the minimal spread Forex stockbrokers vend in widespread pairs, the spreads are little. The spread size effects of an exchange operation. When the spread is imparted to the standard daily range of the cash, a percentage reveals the spread tariff.
Spread is a kind of fee levied automatically at the moment of the starting of an operation. The stock exchanges themselves control market liquidity by setting certain restrictions on the spread. Trading stops instantly as soon as their maximum values are achieved.