Buy and Sell Abbreviations and What Do They Mean
So many popular trading terms are shortened throughout Forex trading. Many experienced Forex traders prefer to use buy and sell abbreviations rather than refer to full words. But, such abbreviations can seem hard for newbies to grasp!
Understanding buying and selling terminology allows you to work on the international exchange market. It also gives you an increased knowledge of how currencies are bought and sold.
We’ve taken those most common buy and sell abbreviations and sectioned them into alphabetical order. We’ve also added a handy currency list which is essential when it comes to Forex trading. You're welcome!
Widely used Forex Buy and Sell Abbreviations and their Meanings
ADX – Average Directional Index – A technical analysis indicator that can determine a trend's strength.
ATR – Average True Range – A technical analysis indicator which measures market volatility.
BB – Bollinger Bands – Volatility bands which can be placed both above and below a moving average.
BC - Base Currency - The first currency of the currency pair.
BE – Breakeven – The point of balance which makes neither a profit nor a loss.
BOC – The Bank of Canada.
BOE – The Bank of England
BOJ – The Bank of Japan.
BP – Basis Point – A measure item for ranges, rates, and other percentages.
CFTC – Commodity Futures Trading Commission – An agency independent of the US government which regulates future and option markets.
COT – Commitments of Traders – A weekly market report released by the CFTC outlining the different trader types and their positioning in the future market.
CSI – Commodity Selection Index – A technical indicator that attempts to identify those most suitable commodities for short term trading.
CCI – Commodity Channel Index – An indication showing current changes in prices. (Sometimes referred to as Consumer Confidence Index)
CFA – Chartered Financial Analyst – A professional title offered by the CFA Institute.
CFD – Contract for Difference – A contract between two parties consisting of the buyer and the seller, stating the difference to be paid by either person.
CPI – Consumer Price Index – A calculated method of taking the price changes of each item and then averaging them.
CTA – Commodity Trading Advisor – An individual or firm providing buying and selling advice on FX contracts.
DD – Drawdown (Also Due Diligence and Dealing Desk) – A peak and subsequent trough decline during a period for investment funds or trading accounts.
DJIA – Dow Jones Industrial Average – The United States stock market index of publicly owned companies.
EA – Expert Advisor.
ECB – The European Central Bank
ECN – Electronic Communication Network – (Also Electronic Currency Network) – A computerized buying and selling system for orders.
EMA – Exponential Moving Average – A weighted moving average giving importance to recent price data.
ETF – Exchange Traded Fund – Funds that issue shares which are traded on a stock exchange.
EW – Elliott Wave Theory – A strategy based on wave counting, developed by Ralph Nelson Elliott.
FA – Fundamental Analysis – Attempts to measure intrinsic value by examining those related financial and economic factors.
FCM – Futures Commission Merchant – An entity soliciting or accepting orders to buy or sell for customers.
FDM – Forex Dealer Member.
FED – Federal Reverse System – The USA’s central banking system.
FF – Forex Factory – A place exclusively designed for those professional Forex market traders.
FIFO – First In, First out – An asset management and valuation method where assets acquired or produced first are sold, used or disposed of first.
FOMC – Federal Open Market Committee.
FY – Fiscal Year – The twelve-month financial year of a company
FX – Foreign Exchange – The International Stock Market
GDP – Gross Domestic Product – The total market price for all services and products of one country calculated for the year
GMT – Greenwich Mean Time
HH – Higher Chart - A trading trend.
HL – Higher Low - A trading trend.
IB – Introducing Broker.
IMF – International Monetary Fund – An international organization which works to ensure the ongoing stability of the international monetary system.
ISO – International Organization for Standardization.
LH – Lower High – A trading trend.
LL – Lower Low - A trading trend.
LONG – A purchasing position of one specific currency against another.
LWMA – Linearly Weighted Moving Average - A method of calculating an average asset price over a given period.
MA – Moving Average – An easy analysis tool which creates a constantly updated average price thus smoothing out price data.
MACD – Middle Average Convergence Divergence – An FX indicator based on crossing and calculating of moving averages
MM – Market Maker (Also Money Management) – A company or individual who quotes both a buy and sell price, with the intentions of making a profit.
MT4 – MetaTrader Version 4.0 - A popular trading platform.
MTF – Multiple Time Frame.
NASDAQ – National Association of Securities Dealers Automated Quotation.
NFP – Nonfarm Payroll – A monthly report measuring US jobs added or lost.
NDA – Non Disclosure agreement.
NDD – Non-Dealing Desk – A way of trading which produces intermediate interbank market access.
NFA – National Futures Association.
NYSE – The New York Stock Exchange
OCO – One Cancels the Other Order. One is executed, the other is automatically canceled.
OHLC – Open, High, Low, Close – A chart type used to illustrate movements in the price of financial instruments over time.
OTC – Over the Counter – Describing transactions that aren’t conducted over an exchange.
PA – Price Action – The movement plotted over time of a security’s price.
PB – Pin Bar (Abbreviation of Pinocchio Bar) – A typical price pattern amongst those active of traders.
P&F - Point and Figure – A chart which plots price movements without taking into consideration the passing of time.
PIP – Price Interest Point – (Also Performance Index Paper) – A unit of change in a currency pair exchange rate.
PP – Pivot Point – An indicator determining overall market trends.
PPI – Producer Price Index - Measures average changes in domestic prices received for their output.
PPZ – Price Pivot Zone – The zone or point where price meets support or resistance at various times.
PSAR – Parabolic Stop and Reversal – A method of finding potential market reversals.
Q – Quarter - Abbreviation for three months.
Quant – Quantitative Analysis – A method of understanding behavior utilizing mathematical and statistical data.
RBA – The Reserve Bank of Australia.
R/R - Risk/Reward – Ratio comparing expected return with the amount of risk undertaken.
RSI – Relative Strength Index - An indicator which analyzes the strength of a trend and forecasts any changes.
RVI – Relative Vigor Index – An indicator measuring trend strength through comparison of closing price to a trading range.
SA – Seasonally Adjusted – Adjusting changes to specific seasons by calculating statistics to even swings.
SAR – Stop and Reversal – An indicator which identifies suitable exit and entry points.
SEC – Securities and Exchange Commission.
SHORT – To sell a currency.
SL – Stop Loss Order – An order to buy or sell your currency pair or stock when your predetermined price is reached.
SMA – Simple Moving Average – Adds recent closing prices and divides them by several periods in the calculation average.
SMMA – Smoothed Moving Average – Popular moving average indicator.
S&P – Standard & Poor's Index – Forerunners of present-day stock reporting and analysis.
Stoch – Stochastic Oscillator – Presents closing price stock location in relation to high and low ranges of the stock price over a time frame.
S/R – Support/Resistance – Used when referring to chart price levels.
STP – Straight Through Processing – Where the broker's role is a middleman between the client and liquidity broker
TA – Technical Analysis – The study of market action undertaken primarily through the use of charts.
TF – Time Frame.
TL – Trend Line - The bounding line for a security’s price movement.
TP – Take Profit – Limit orders which close when a specific profit level’s reached.
TS – Trailing Stop – A stop order set at a defined rate or price away from the security’s current market price.
TSI – True Strength Index – Provides trade signals based on technical momentums.
USDX – United States Dollar Index.
UTC – Universal Time Co-ordinated.
WB – World Bank.
WTO – The World Trade Organization.
XAG – Silver – ISO Code quoted as one ounce.
XAU – Gold – ISO Code quoted as one ounce.
These are some of the more major of currencies, according to Investopedia.
All traders should familiarize themselves with these when beginning their Forex Trading journey:
USD – The US Dollar
EUR – The European Euro
JPY – The Japanese Yen
GBP – The Great British Pound
CHF – The Swiss Franc
CAD – The Canadian Dollar
AUD - The Australian Dollar
NZD – The New Zealand Dollar
ZAR – The South African Rand
Besides these currencies, there are also others you’ll come across such as:
HKD – The Hong Kong Dollar
NOK – The Norwegian Krone
MXN – The Mexican Peso
DKK - The Danish Krone
RUR (rub) - The Russian Ruble
Final Thoughts on Buy and Sell Abbreviations and their Meanings
Overall, most buy and sell abbreviations are merely shortened for one primary reason. They make the job of trading in the buying and selling markets of Forex more productive and easier. This is especially so when it comes to those monetary abbreviations!
Forex trading may initially seem like a whole new concept of its own. In fact, it does have an international lexicon that all those involved will refer to time and time again.
Thus, we recommend getting to know it and then applying it to your own buying and selling activities. (you can save this post so you can back to these buy and sell abbreviations list whenever you need it!). This will undoubtedly improve your Forex Trading experience no end.