MetaTrader 5 Strategy Tester: Backtesting & Optimisation

1.MetaTrader 5 Strategy Tester: Backtesting and Optimisation
2.Understanding the MetaTrader 5 Strategy Tester
3.How to Perform Backtesting in MetaTrader 5
4.Analysing Backtesting Results
5.Strategy Optimisation in MetaTrader 5

MetaTrader 5 Strategy Tester: Backtesting and Optimisation

MetaTrader 5 (MT5) offers a powerful built-in Strategy Tester, a tool designed to help traders evaluate the performance of Expert Advisors (EAs) before deploying them in live trading. This feature enables traders to test their strategies using historical data, assess potential risks, and refine parameters for better performance.

The Strategy Tester is not limited to simple backtesting—it also provides optimisation capabilities, allowing traders to fine-tune their strategies by adjusting multiple variables to find the most effective trading setup.

Importance of Backtesting and Optimisation

Backtesting is a crucial step in trading, allowing traders to validate a strategy before risking real capital. By simulating past market conditions, traders can determine how an EA would have performed, identify weaknesses, and make necessary adjustments.

Optimisation takes this a step further by systematically tweaking the parameters of a strategy to maximise performance. Using MetaTrader 5’s advanced optimisation engine, traders can test thousands of parameter combinations and find the best settings for different market conditions.

How Strategy Tester Helps Traders

  • Reduces Risk: Backtesting helps identify flaws in a strategy before trading with real money.
  • Improves Strategy Performance: Optimisation allows traders to fine-tune parameters for maximum efficiency.
  • Saves Time: The automation of testing and optimisation speeds up the strategy development process.
  • Enhances Confidence: A well-tested strategy gives traders confidence in their trading decisions.
  • Adapts to Market Conditions: Regular backtesting ensures that a strategy remains effective as market dynamics change.

By understanding the MetaTrader 5 Strategy Tester, traders can make data-driven decisions and increase their chances of success in the markets.

Understanding the MetaTrader 5 Strategy Tester

The MT5 Strategy Tester is a specialised module designed to assess the performance of automated trading systems. It allows traders to:

  • Analyse historical price data to simulate trading conditions.
  • Measure the effectiveness of an EA based on predefined parameters.
  • Optimise trading strategies by adjusting input variables.
  • Identify strengths and weaknesses in a trading strategy before live deployment.

Unlike manual testing, where traders rely on forward testing in a demo account, the Strategy Tester accelerates the process by running simulations in minutes or hours over long periods.

Key Features of the Strategy Tester

The MT5 Strategy Tester has advanced features that provide traders with in-depth insights into their strategies. Key features include:

  • Single and Multi-Currency Testing – Unlike MT4, which supports only single-symbol testing, MT5 allows traders to backtest strategies involving multiple currency pairs, stocks, or other instruments simultaneously.
  • Multiple Testing Modes – Traders can choose between different testing models, such as Every Tick, 1-Minute OHLC, and Open Prices, depending on the level of accuracy required.
  • Optimisation Engine – The Strategy Tester offers an advanced genetic algorithm that can systematically adjust strategy parameters to find the best possible settings.
  • Visual Mode – A built-in chart playback function lets traders observe how an EA executes trades in real-time within the historical market data.
  • Performance Reports – After running a backtest, the tester generates a detailed report that includes key trading metrics such as total profit, drawdown, and risk-to-reward ratio.
  • Tick-by-Tick Simulation – The tester uses tick data from the broker to simulate price movements as accurately as possible.
  • Distributed Computing – Traders can speed up backtesting and optimisation by using remote agents, which distribute the computational load across multiple machines.

Single vs Multi-Currency Testing

One of the biggest improvements in MT5’s Strategy Tester over MT4 is the ability to test multi-currency strategies.

  • Single-Currency Testing – This mode is useful for EAs that trade one currency pair at a time. It allows traders to evaluate strategy performance on a specific market.
  • Multi-Currency Testing – Traders who use arbitrage, correlation-based, or portfolio strategies benefit from this feature. The tester can simulate how an EA would perform across multiple instruments at once, reflecting real-world trading conditions more accurately.

How to Perform Backtesting in MetaTrader 5

Backtesting in MetaTrader 5 (MT5) is the process of evaluating a trading strategy or Expert Advisor (EA) using historical price data. This allows traders to assess its past performance and make necessary adjustments before deploying it in live trading.

Setting Up the Strategy Tester

To start a backtest, follow these steps:

  1. Open the Strategy Tester – In MT5, go to ViewStrategy Tester or press Ctrl + R to open the tester panel.
  2. Select the Expert Advisor (EA) – Choose the EA you want to test from the dropdown menu. If the EA is not on the list, ensure it is correctly installed in the Experts folder.
  3. Choose the Financial Instrument – Select the currency pair, stock, or other instrument you want to backtest the strategy on.
  4. Set the Timeframe – Pick a timeframe (e.g., M1, M5, H1, D1) that aligns with the strategy’s intended use.

Selecting an Expert Advisor (EA)

  • If you are testing a pre-built EA, select it from the dropdown list.
  • If you are testing a custom EA, make sure it is compiled correctly in the MetaEditor.

Choosing the Right Timeframe and Data

The accuracy of backtesting depends heavily on the quality of historical data and the timeframe used:

  • Short-Term Strategies – Use M1 or M5 data for scalping or day trading strategies.
  • Long-Term Strategies – Use H4, D1, or higher timeframes for swing trading or position trading.
  • Ensure Quality Data – Download complete historical data from your broker to get reliable test results.

Understanding Modelling Methods

MT5 provides different modelling methods to simulate price movement:

  1. Every Tick (Most Accurate) – Uses tick-by-tick historical data for maximum accuracy. Best for scalping and high-frequency strategies.
  2. 1-Minute OHLC (Moderate Accuracy) – Uses Open, High, Low, and Close prices of each 1-minute bar. Suitable for medium-term strategies.
  3. Open Prices Only (Fastest, Least Accurate) – Uses only the opening price of each candlestick. Best for quick testing of long-term strategies.

Running a Basic Backtest

  1. Configure Inputs – Click Inputs to set parameters such as lot size, stop loss, and take profit.
  2. Select the Deposit & Leverage – Choose the starting balance and leverage that match your real trading conditions.
  3. Enable Visual Mode (Optional) – If you want to see trades executed on a chart, enable the Visual Mode checkbox.

Run the Test – Click Start to begin backtesting. MT5 will simulate the EA’s performance over the selected historical period.

Analysing Backtesting Results

Once a backtest is complete, the MetaTrader 5 Strategy Tester generates a detailed performance report that provides key insights into how the strategy performed over the tested period. Analysing this data is crucial to determining a trading strategy’s profitability, risk, and reliability before using it in live markets.

Understanding the Strategy Tester Report

After running a backtest, MT5 presents a comprehensive report that includes:

  1. Graphical Performance Overview – A visual representation of balance and equity changes over time.
  2. Detailed Trade Statistics – Metrics include total profit/loss, drawdown, number of trades, and win rate.
  3. List of Executed Trades – A record of every trade, including entry/exit points, profit/loss, and order type.

To access the results:

  • Open the Strategy Tester window.
  • Click on the “Results” or “Graph” tab to view trade details and performance graphs.
  • Click on “Report” to generate a full breakdown of backtest statistics.

The backtesting performance can be evaluated with various metrics, including net profit & gross profit/loss, profit factor, expected payoff, drawdown (risk assessment), win rate (winning trade performance), and sharpe ratio (risk-adjusted ratio).

Interpreting the Balance and Equity Charts

  1. Balance Curve: A smooth, upward-sloping balance curve suggests a consistent strategy. However, a curve with sharp drops indicates high drawdowns or risky trades.

  2. Equity Curve: If the equity curve stays close to the balance curve, the strategy performs steadily without large floating losses. However, if the equity curve is highly volatile, the strategy may have high-risk exposure.

A stable and consistent equity curve is a sign of a robust strategy.

Strategy Optimisation in MetaTrader 5

Strategy optimisation in MetaTrader 5 (MT5) is systematically testing different parameter combinations to improve an Expert Advisor’s (EA) performance. The goal is to find the best settings that maximise profitability while minimising risk. 

Unlike backtesting, which evaluates a single set of parameters, optimisation fine-tunes variables such as lot size, stop-loss, take-profit, and indicator settings to improve strategy efficiency.

What is Optimisation?

Optimisation involves running multiple backtests with different input values to:

  • Identify the best-performing settings for a strategy.
  • Improve risk management by finding optimal stop-loss and take-profit levels.
  • Adapt the strategy to different market conditions.
  • Increase profitability by fine-tuning entry and exit rules.

How Optimisation Works in MT5

Step 1: Open the Strategy Tester

  • Navigate to View → Strategy Tester or press Ctrl + R.
  • Select the EA you want to optimise from the Expert Advisor dropdown menu.

Step 2: Enable Optimisation Mode

  • Check the “Optimization” box in the Strategy Tester panel.
  • Select the financial instrument, timeframe, and modeling method (e.g., Every Tick for accuracy).

Step 3: Set Optimisation Parameters

  • Click the “Inputs” tab and select which EA parameters to optimise.
  • Define minimum, maximum, and step values for each variable.
    • Stop-Loss: 10 → 100 (Step 10)
    • Take-Profit: 20 → 200 (Step 20)

Larger steps speed up testing but may miss optimal values.

Step 4: Choose an Optimisation Algorithm

MT5 offers two types of optimisation methods:

1. Full Optimisation (Exhaustive Search)

  • Tests all possible parameter combinations.
  • Best for small parameter sets but can be slow for complex strategies.
  • Guarantees finding the best solution but requires significant processing power.

2. Genetic Algorithm (Smart Optimisation)

  • Uses AI-based selection to find the best parameters without testing every combination.
  • Prioritises high-performing configurations while discarding weak ones.
  • Faster and more efficient for large parameter sets.

Genetic Optimisation is recommended for most traders due to its speed and efficiency.

Step 5: Set Performance Criteria

  • Define what “best results” mean:
    • Maximise Profit Factor (Profit / Loss).
    • Minimise Drawdown (Risk Control).
    • Optimise Sharpe Ratio (Risk-Adjusted Returns).
    • Improve Win Rate (Winning Trades %).

Step 6: Run the Optimisation

  • Click Start to begin the optimisation process.
  • MT5 will test multiple parameter combinations and rank them based on performance.

Understanding the Optimisation Results

After running optimisation, MT5 displays a table of results, ranking parameter sets based on profitability and risk.

Filtering the Best Results

  • Sort by Net Profit – High-profit strategies may carry higher risk.
  • Check Drawdown – Avoid strategies with excessive drawdowns (>30%).
  • Look at Trade Consistency – Stable strategies perform well across different periods.

A strategy with high profit but high drawdown may not be suitable for live trading.

Understanding the Optimisation Graph

  • X-Axis: Different parameter combinations.
  • Y-Axis: Performance metric (e.g., net profit, drawdown).
  • A smooth upward curve indicates stable results.
  • A jagged, erratic graph suggests overfitting or inconsistent performance.

Avoiding Overfitting

Overfitting occurs when an EA is too finely tuned to past data and fails in live trading. To prevent overfitting:

  1. Use Different Data Periods – Optimise on one dataset, then test on another.
  2. Avoid Too Many Parameters – Over-optimising variables may reduce strategy robustness.
  3. Apply Walk-Forward Testing – Validate the strategy in different market conditions.

The MetaTrader 5 Strategy Tester is an essential tool for traders looking to develop, test, and refine automated trading strategies. By combining accurate backtesting with advanced optimisation features, it enables traders to make informed decisions, manage risk effectively, and adapt to changing market conditions. Whether you’re testing a simple EA or fine-tuning a complex multi-currency strategy, the Strategy Tester offers the speed, flexibility, and precision needed to improve overall trading performance.

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Glossary

Get started or expand your knowledge of trading at any level with a wealth of financial industry terms and definitions that you won’t find anywhere else.

Bookmarked Trading Term(s)

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  • AMM (Automated Money Market)

    A decentralized system that uses algorithms to automatically manage liquidity and trading in financial markets without traditional market makers.

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  • APR (Annual Percentage Rate)

    The yearly interest rate a trader pays on borrowed funds or e arns on investments, excluding compounding.

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  • APY (Annual Percentage Yield)

    The yearly interest rate a trader earns, including compounding, which reflects the real return on an investment.

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  • Asymmetric Cryptography

    A security method using two different keys (public and private) to encrypt and decrypt data, ensuring secure transactions.

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  • Asymmetric Encryption

    The apportionment of premiums and discounts on forward exchange transactions that relate directly to deposit swap (interest arbitrage) deals, over the period of each deal.

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  • Atomic Swap

    A direct peer-to-peer exchange of different cryptocurrencies without the need for intermediaries, reducing counterparty risk.

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  • Balance Of Trade

    The value of a country's exports minus its imports.

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  • Bar Chart

    A type of chart which consists of four significant points: the high and the low prices, which form the vertical bar; the opening price, which is marked with a horizontal line to the left of the bar; and the closing price, which is marked with a horizontal line to the right of the bar.

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  • Barrier Level

    A certain price of great importance included in the structure of a Barrier Option. If a Barrier Level price is reached, the terms of a specific Barrier Option call for a series of events to occur.

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  • Barrier Option

    Any number of different option structures (such as knock-in, knock-out, no touch, double-no-touch-DNT) that attaches great importance to a specific price trading. In a no-touch barrier, a large defined payout is awarded to the buyer of the option by the seller if the strike price is not 'touched' before expiry. This creates an incentive for the option seller to drive prices through the strike level and creates an incentive for the option buyer to defend the strike level.

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  • Base Currency

    The first currency in a currency pair. It shows how much the base currency is worth as measured against the second currency. For example, if the USD/CHF (U.S. Dollar/Swiss Franc) rate equals 1.6215, then one USD is worth CHF 1.6215. In the forex market, the US dollar is normally considered the base currency for quotes, meaning that quotes are expressed as a unit of $1 USD per the other currency quoted in the pair. The primary exceptions to this rule are the British pound, the euro and the Australian dollar.

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  • Cable

    The GBP/USD (Great British Pound/U.S. Dollar) pair. Cable earned its nickname because the rate was originally transmitted to the US via a transatlantic cable beginning in the mid 1800s when the GBP was the currency of international trade.

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  • Cad

    The Canadian dollar, also known as Loonie or Funds.

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  • Call Option

    A currency trade which exploits the interest rate difference between two countries. By selling a currency with a low rate of interest and buying a currency with a high rate of interest, the trader will receive the interest difference between the two countries while this trade is open.

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  • Canadian Ivey Purchasing Managers (Cipm) Index

    A monthly gauge of Canadian business sentiment issued by the Richard Ivey Business School.

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  • Candlestick Chart

    A chart that indicates the trading range for the day as well as the opening and closing price. If the open price is higher than the close price, the rectangle between the open and close price is shaded. If the close price is higher than the open price, that area of the chart is not shaded.

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  • Day Trader

    Speculators who take positions in commodities and then liquidate those positions prior to the close of the same trading day.

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  • Day Trading

    Making an open and close trade in the same product in one day.

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  • Deal

    A term that denotes a trade done at the current market price. It is a live trade as opposed to an order.

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  • Dealer

    An individual or firm that acts as a principal or counterpart to a transaction. Principals take one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party. In contrast, a broker is an individual or firm that acts as an intermediary, putting together buyers and sellers for a fee or commission.

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  • Dealing Spread

    The difference between the buying and selling price of a contract.

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  • Ecb

    European Central Bank, the central bank for the countries using the euro.

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  • Economic Indicator

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

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  • End Of Day Order (eod)

    An order to buy or sell at a specified price that remains open until the end of the trading day.

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  • Est/Edt

    The time zone of New York City, which stands for United States Eastern Standard Time/Eastern Daylight time.

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  • Estx50

    A name for the Euronext 50 index.

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  • Factory Orders

    The dollar level of new orders for both durable and nondurable goods. This report is more in depth than the durable goods report which is released earlier in the month.

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  • Fed

    The Federal Reserve Bank, the central bank of the United States, or the FOMC (Federal Open Market Committee), the policy-setting committee of the Federal Reserve.

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  • Fed Officials

    Refers to members of the Board of Governors of the Federal Reserve or regional Federal Reserve Bank Presidents.

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  • Figure/The Figure

    Refers to the price quotation of '00' in a price such as 00-03 (1.2600-03) and would be read as 'figure-three.' If someone sells at 1.2600, traders would say 'the figure was given' or 'the figure was hit.

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  • Fill

    When an order has been fully executed.

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  • G7

    Group of 7 Nations - United States, Japan, Germany, United Kingdom, France, Italy and Canada.

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  • G8

    Group of 8 - G7 nations plus Russia.

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  • Gap Gapping

    A quick market move in which prices skip several levels without any trades occurring. Gaps usually follow economic data or news announcements.

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  • Gearing (Also Known As Leverage)

    Gearing refers to trading a notional value that is greater than the amount of capital a trader is required to hold in his or her trading account. It is expressed as a percentage or a fraction.

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  • Ger30

    An index of the top 30 companies (by market capitalization) listed on the German stock exchange – another name for the DAX.

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  • Handle

    Every 100 pips in the FX market starting with 000.

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  • Hawk/Hawkish

    A country's monetary policymakers are referred to as hawkish when they believe that higher interest rates are needed, usually to combat inflation or restrain rapid economic growth or both.

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  • Hedge

    A position or combination of positions that reduces the risk of your primary position.

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  • Hit The Bid

    To sell at the current market bid.

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  • Hk50/Hkhi

    Names for the Hong Kong Hang Seng index.

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  • Illiquid

    Little volume being traded in the market; a lack of liquidity often creates choppy market conditions. 

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  • Imm

    The IMM, or International Monetary Market, is a part of the Chicago Mercantile Exchange (CME) that deals with trading currency and interest rate futures and options.

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  • Imm Futures

    A traditional futures contract based on major currencies against the US dollar. IMM futures are traded on the floor of the Chicago Mercantile Exchange.

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  • Imm Session

    8:00am - 3:00pm New York.

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  • Indu

    Abbreviation for the Dow Jones Industrial Average.

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  • Japanese Economy Watchers Survey

    Measures the mood of businesses that directly service consumers such as waiters, drivers and beauticians. Readings above 50 generally signal improvements in sentiment.

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  • Japanese Machine Tool Orders

    Measures the total value of new orders placed with machine tool manufacturers. Machine tool orders are a measure of the demand for companies that make machines, a leading indicator of future industrial production. Strong data generally signals that manufacturing is improving and that the economy is in an expansion phase.

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  • Jpn225

    A name for the NEKKEI index.

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  • Keep The Powder Dry

    To limit your trades due to inclement trading conditions. In either choppy or extremely narrow markets, it may be better to stay on the sidelines until a clear opportunity arises.

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  • Kiwi

    Nickname for NZD/USD (New Zealand Dollar/U.S. Dollar).

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  • Knock-Ins

    Option strategy that requires the underlying product to trade at a certain price before a previously bought option becomes active. Knock-ins are used to reduce premium costs of the underlying option and can trigger hedging activities once an option is activated.

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  • Knock-Outs

    Option that nullifies a previously bought option if the underlying product trades a certain level. When a knock-out level is traded, the underlying option ceases to exist and any hedging may have to be unwound.

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  • Last Dealing Day

    The last day you may trade a particular product.

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  • Last Dealing Time

    The last time you may trade a particular product.

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  • Leading Indicators

    Statistics that are considered to predict future economic activity.

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  • Level

    A price zone or particular price that is significant from a technical standpoint or based on reported orders/option interest.

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  • Leverage

    Also known as margin, this is the percentage or fractional increase you can trade from the amount of capital you have available. It allows traders to trade notional values far higher than the capital they have. For example, leverage of 100:1 means you can trade a notional value 100 times greater than the capital in your trading account.*

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  • Macro

    The longest-term trader who bases their trade decisions on fundamental analysis. A macro trade’s holding period can last anywhere from around six months to multiple years.

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  • Manufacturing Production

    Measures the total output of the manufacturing aspect of the Industrial Production figures. This data only measures the 13 sub-sectors that relate directly to manufacturing. Manufacturing makes up approximately 80% of total Industrial Production.

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  • Market Call

    A request from a broker or dealer for additional funds or other collateral on a position that has moved against the customer.

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  • Market Maker

    A dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial product.

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  • Market Order

    An order to buy or sell at the current price.

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  • Nas100

    An abbreviation for the NASDAQ 100 index.

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  • Net Position

    The amount of currency bought or sold which has not yet been offset by opposite transactions.

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  • New York Session

    8:00am – 5:00pm (New York time).

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  • No Touch

    An option that pays a fixed amount to the holder if the market never touches the predetermined Barrier Level.

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  • Nya.X

    Symbol for NYSE Composite index.

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  • Offer (Also Known As The Ask Price)

    The price at which the market is prepared to sell a product. Prices are quoted two-way as Bid/Offer. The Offer price is also known as the Ask. The Ask represents the price at which a trader can buy the base currency, which is shown to the right in a currency pair. For example, in the quote USD/CHF 1.4527/32, the base currency is USD, and the ask price is 1.4532, meaning you can buy one US dollar for 1.4532 Swiss francs. 

    In CFD trading, the Ask represents the price a trader can buy the product. For example, in the quote for UK OIL 111.13/111.16, the product quoted is UK OIL and the ask price is £111.16 for one unit of the underlying market.

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  • Offered

    If a market is said to be trading offered, it means a pair is attracting heavy selling interest, or offers.

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  • Offsetting Transaction

    A trade that cancels or offsets some or all of the market risk of an open position.

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  • On Top

    Attempting to sell at the current market order price.

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  • One Cancels The Other Order (oco)

    A designation for two orders whereby if one part of the two orders is executed, then the other is automatically cancelled.

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  • Paid

    Refers to the offer side of the market dealing.

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  • Pair

    The forex quoting convention of matching one currency against the other.

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  • Paneled

    A very heavy round of selling.

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  • Parabolic

    A market that moves a great distance in a very short period of time, frequently moving in an accelerating fashion that resembles one half of a parabola. Parabolic moves can be either up or down.

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  • Partial Fill

    When only part of an order has been executed.

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  • Quantitative Easing

    When a central bank injects money into an economy with the aim of stimulating growth.

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  • Quarterly Cfds

    When a central bank injects money into an economy with the aim of stimulating growth.

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  • Quote

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

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  • Rally

    A recovery in price after a period of decline.

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  • Range

    When a price is trading between a defined high and low, moving within these two boundaries without breaking out from them.

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  • Rate

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

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  • Rba

    Reserve Bank of Australia, the central bank of Australia.

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  • Rbnz

    Reserve Bank of New Zealand, the central bank of New Zealand.

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  • Sec

    The Securities and Exchange Commission.

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  • Sector

    A group of securities that operate in a similar industry.

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  • Sell

    Taking a short position in expectation that the market is going to go down.

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  • Settlement

    The process by which a trade is entered into the books, recording the counterparts to a transaction. The settlement of currency trades may or may not involve the actual physical exchange of one currency for another.

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  • Shga.X

    Symbol for the Shanghai A index

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  • Takeover

    Assuming control of a company by buying its stock.

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  • Technical Analysis

    The process by which charts of past price patterns are studied for clues as to the direction of future price movements.

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  • Technicians/techs

    Traders who base their trading decisions on technical or charts analysis.

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  • Ten (10) Yr

    US government-issued debt which is repayable in ten years. For example, a US 10-year note.

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  • Thin

    A illiquid, slippery or choppy market environment. A light-volume market that produces erratic trading conditions.

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  • Ugly

    Describing unforgiving market conditions that can be violent and quick.

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  • Uk Average Earnings Including Bonus/ Excluding Bonus

    Measures the average wage including/excluding bonuses paid to employees. This is measured quarter-on-quarter (QoQ) from the previous year.

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  • Uk Claimant Count Rate

    Measures the number of people claiming unemployment benefits. The claimant count figures tend to be lower than the unemployment data since not all of the unemployed are eligible for benefits.

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  • Uk Hbos House Price Index

    Measures the relative level of UK house prices for an indication of trends in the UK real estate sector and their implication for the overall economic outlook. This index is the longest monthly data series of any UK housing index, published by the largest UK mortgage lender (Halifax Building Society/Bank of Scotland).

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  • Uk Jobless Claims Change

    Measures the change in the number of people claiming unemployment benefits over the previous month.

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  • Value Date

    Also known as the maturity date, it is the date on which counterparts to a financial transaction agree to settle their respective obligations, i.e., exchanging payments. For spot currency transactions, the value date is normally two business days forward.

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  • Variation Margin

    Funds traders must hold in their accounts to have the required margin necessary to cope with market fluctuations.

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  • Vix Or Volatility Index

    Shows the market's expectation of 30-day volatility. It is constructed using the implied volatilities of a wide range of S&P 500 index options. The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge."

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  • Volatility

    Referring to active markets that often present trade opportunities.

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  • Wedge Chart Pattern

    Chart formation that shows a narrowing price range over time, where price highs in an ascending wedge decrease incrementally, or in a descending wedge, price declines are incrementally smaller. Ascending wedges typically conclude with a downside breakout and descending wedges typically terminate with upside breakouts.

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  • Whipsaw

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

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  • Wholesale Price

    Measures the changes in prices paid by retailers for finished goods. Inflationary pressures typically show earlier than the headline retail.

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  • Working Order

    Where a limit order has been requested but not yet filled.

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  • Wsj

    Acronym for The Wall Street Journal.

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  • Xag/Usd

    Symbol for Silver Index.

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  • Xau/Usd

    Symbol for Gold Index.

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  • Xax.X

    Symbol for AMEX Composite Index.

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  • YER

    Yemeni Rial. The currency of Yemen. It is subdivided into 100 fils.

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  • Yemeni Rial

    See YER.

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  • Yen

    See JPY.

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  • Yield

    Yield is the return on an investment and is usually expressed as a percentage.

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  • Yuan Renminbi

    See CNY

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  • ZAR

    Rand. The currency of South Africa. It is subdivided into 100 cents.

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  • ZMW

    Zambian Kwacha. The currency of Zambia. It is subdivided into 100 Ngwee.

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  • ZWL

    Zimbabwe Dollar. The currency of Zimbabwe. It is subdivided into 100 cents.

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  • Zambian Kwacha

    See ZMW.

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  • ZigZag

    A technical indicator that draws tops and bottoms - filtering out noise.

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  • Zimbabwe Dollar

    See ZWL.

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    Bookmarked Trading Term(s)

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