Broker: A company or individual who negotiate on behalf
commercial institutions and the general public.
Bull Market: A market in which the prices are on rising mode.
Commission Fee: A fee charged by a broker for executing a transaction.
Commodity: A product that can be used for commerce.
The types of commodities include agricultural products, metals,
petroleum, foreign currencies, and financial instruments
and index.
of good faith in entering into a contract to purchase; earnest money;
security for the buyer's performance of a contract. An earnest money deposit
is not necessary to create a valid purchase contract because
the mutual promises of the parties to buy and to sell are sufficient
consideration because the mutual promises of the parties to buy and to sell
are sufficient consideration to enforce the contract. If the buyer completes
the purchase, the deposit money is applied toward the purchase price.
Double Tops & Double Bottoms (“M” & “W” Formation): Appearing as
an M or W on a technician’s bar chart, double tops and double bottoms
have a tendency to indicate major market movements.
price movements on the basis of historical price Wave patterns and
their Underlying psychological motives.
Eurodollars: Refers to a short term certificate of deposit in U.S. dollars
guaranteed by a bank outside of the United States and, consequently,
outside the jurisdiction of the United States. The bank could be either
a foreign bank or a subsidiary of a U.S. bank.
Expiration: The time and date an option contract expires.
of the certificate of a security; the original dollar amount
of indebtedness incurred.
Fundamental Analysis: A method of anticipating future price
movement using supply and demand information.
Futures Contract: A legally binding agreement, traded on
a commodity exchange, to buy or sell a commodity at a date
in the future. Futures contracts are standardized according to
the quality, quantity, and delivery time and location for
each commodity. The only variable is price.
Key Reversal: Combines the outside day and the closing price reversal.
The essential pattern difference from the closing price reversal is that
both opening and closing prices exceed the extremes of
the previous day’s range
the average of security, index or commodity prices constructed
in a period as short as a few minutes or as long as several years
and showing trends for the latest interval. As each new variable
is included in calculating the average.
OPEC: Organization of Petroleum Exporting Countries, emerged
as the major petroleum pricing power in 1973, when the ownership
of oil production in the Middle East transferred from the operating
companies to the governments of the producing countries or
to their national oil companies. Members are: Algeria, Ecuador,
Gabon, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar,
Saudi Arabia, the United Arab Emirates, and Venezuela.
Oscillator: Technical indicator that allows a trader to measure
overbought or oversoldconditions in sideways markets.
Relative Strength Index (RSI): A popular oscillator used by commodity
traders showing the relative strength between buyers and sellers.
Resistance: A level above which prices have had difficulty penetrating.
Speculator: A person who tries to make money buying and selling
futures and options with the sole intention to make a quick profit.
conditions in a stock over a certain period.
Stock Market: A market in which shares of different companies are bought and sold.
Technical Analysis: Anticipating future price movement using historical prices,
trading volume, open interest and other trading data to study price patterns.
U.S. Treasury Bonds: Government-debt security with a coupon and original
maturity of more than 2 years. Interest is paid semiannually.
Volume: The number of purchases or sales of a commodity futures contract
made during a specific period of time, often the total transactions for one trading day.
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