Ask

An offer price in the market. At this price you can buy the assets.

Bull

The bulls are the traders waiting for the asset price rise. They buy the assets to sell them at a higher
price in the future.

Bull Market

The market where we can see the price increase. The bulls are the key players in the bull market. As they
suppose this term was taken because the ascending chart reminds the bull horns raised up.

Currency Pair

A trading instrument to trade in the forex market.

Return

On the ExpertOption platform the trader receives up to 45% of the investment amount even in a case of
the unprofitable deal. The return amount is set when you buy an option.

Volatility

A strength of the asset price swing for a definite time interval. The more changeable the asset price is
the higher volatility is.

Deposit

A balance of a trader’s account. The trader can use these funds to open a deal.

Diversification

A diversification is the method of reducing risks by simultaneous trading on some different weakly
connected assets.

Indicator

The instrument which allows you to determine a chart direction. It is a chart option realizing a definite
digital method. The indicators help traders to make a right trading decision.

Bid

A bid price in the market. At this price you can sell the assets.

Corridor

A part of the chart where the asset price changes. The lower bound of the corridor is a support level and
the upper bound is a resistance level.

Correction

A reverse of the price direction directly after the trend.

Correlation

A correlation is an interrelation between the movements of two assets. It shows the relationship
between the rate changes and is measured from -1 to +1. The correlation coefficient +0.8 shows the rate
changes in one direction. For example, let us review the currency pairs EUR/USD and GBP/USD. If one
pair increases the second pair will most likely increase too.

Liquidity

The asset liquidity shows how quickly it can be bought or sold. The more deals with this asset the higher
its liquidity is.

Support Line

A price level below the current rate. The bulls do not let the asset price decrease below this level.
According to the trend strength the support levels can be strong and weak.

Resistance Line

A price level above the current rate. At this level the price is controlled by the bears who do not allow
the further rise of the asset.

Trend Line

At the ascending trend the trend line is built on the local minimums and is a support line. At the
descending trend it is built on the local maximums and is a resistance line.

Bear

Bears are the investors earning on the price reduction.

Bear Market

The market where we can see the asset price drop. In this market the main trends are downward
directed. As they suppose this term was taken as a descending chart reminds the legs of the attacking
bear.

Bear Raid

A coordinated attempt of some bears to reduce the asset price by its active sale.

Traders’ Sentiment
A trading instrument showing the direction of the other traders’ deals on ExpertOption platform.

Bar

A graphic presentation of the asset price changes for a definite period of time which we call a bar chart.

Bonus

A bonus is real money which ExpertOption transfers into your account as extra funds to your deposit.To
trade in the trading market successfully you should forecast price behavior on the chart. One of the
instruments for this kind of job is technical analysis. Technical analysis is a method of price movement
forecasting on the base of price movement history. Studying movement history where the price will go in
future. As you may have guessed the main object of technical analysis is a currency rates history or price
movement chart. The price movement chart is built on axes where the vertical axis shows a price and the
horizontal axis shows time. There are some price types where you can find some repeating patterns. If
you have studied and remembered them you will be able to forecast charts based on building method
and time intervals. At first let us review the difference of charts based on building method. The simplest
one is a line chart which displays price changes in single prices connected with a line. These prices are
fixed on the chart when time interval ends and each new price is connected by a line with a previous
price. It looks as follows:

The following type is a bar chart. This chart is made of bars which show the price at the beginning of
time interval (opening price), maximum and minimum prices within this period and the price at the end
of time interval (closing price). Here is the example of price bars:

The bar chart looks as follows:

The third chart is a candlesticks chart. A candlesticks chart shows the same price information as a bar
chart, but in prettier and easier format. All that because it is made of rectangles called as candlestick
bars. Here is the example of candlestick bars:

Where a bear candle indicates the price falls, and a bull candle shows the price raises. A candlesticks
chart will look as follows:

So as we see, there are three types of charts: line, bar and candlesticks charts. Also the charts are
recognized according to time period: 1 minute, 5 minutes, 15 minutes, 30 minutes, 1 hour, 4 hours, a
day, a week and a month. Time period is the time interval when price was fixed on the chart. For
example, if time interval is 1 hour, on the chart we will see a bar or candle indicating price at the
beginning of an hour, maximum and minimum prices within this hour and price at the end of an hour.
Here is the example:

Changing intervals of the charts you can do analysis of price history on every time intervals.

So, what the technical analysis is? The technical analysis uses charts to study the price history and find
patterns. To use the price movement history for analysis we need to know three rules (axioms) of
technical analysis:

1) Price moves forward – price change is always forward, whether price raises or drops, and it has its
period. This axiom is a basis of tendency (trend) analysis and has the following conclusions: a current
direction of price movement in the market most probably will continue rather than stop; and price will
be moving in one direction until it becomes flat.

2) History repeats – if the price level was reached before it can be reached again in future. The same
goes to price behavior graphical models which can appear in future with the same results as in the past.
Studying the history of these price movement patterns gives us an opportunity more likely to foresee the
further movement direction;

3) Price considers everything – any event affecting on currency price (political, economic and natural) is
included into the price and it raises or drops depending on positive or negative affect of this event.

So thanks to basic rules of the technical analysis we can more likely forecast the price movement,
determine its direction and period of this direction. It is necessary to understand that the market does
not always follow the patterns found in the price movement history. Such unusual situations may
happen, but with each new experience the trader will be able to find more predictable situations and
make more precise estimation. For this very reason you should understand that if you have less
experience you will use the most visible and prominent price movement patterns better to receive a
maximum result. Technical analysis is not a science but it is more likely an art. And if a beginning trader is
more attentive and hardworking he has more chances to receive a desired result.