Learn the economic terms in the forex market


Fundamental or economic analyzes play an important role in predicting exchange rate trends in the foreign exchange market, and their conditions are important in understanding the influences on the economic situation in the country that owns the currency and thus having an impact on currency movements . and the following are the most common terms in the world of economic analysis as they are widely used by many economic analysts to express the state of the economy and predict its future trends, and you can find them mainly on the economic calendar.

Fundamental Analysis:

 Studying the fundamentals of market movement, whether economic or financial, or the reasons behind the market movement. Studying the various economic, political and social factors that affect supply and demand and cause price movements.

Economic Indicators:

 Is the tool the primary analyst uses to measure the extent to which the country’s economic situation has improved or deteriorated and is a set of statistics issued by the country’s government or private agencies the state of the various economic sectors

The economic calendar:

it is the tool that contains all the news, the publications of economic indicators, their data, the degree of their impact and their results, as well as the dates and impact of the speeches of officials and decision-makers in business and business political, reports and minutes of the results scheduled official meeting

The Central Bank: It is the authority authorized by state monetary policy and tries to control inflation rates, stabilize interest rates and the exchange rate in order to increase economic growth.


The offer is the availability of a certain product in a certain period of time.


Demand is the degree of desire and necessity to purchase a certain commodity in a certain period of time.

Business Cycle:

 These are the different phases that economic activity goes through, starting with the top, then the decline, the bottom, then the recovery and then the return to the top, the full economic cycle is calculated when it ends with the same phase of with the it began.


This is the point where economic growth peaks and the results of economic indicators begin to shift from rising to falling


occurs after economic activity peaks and starts to decline, and most economic indicators have negative results


 This is the point when economic decline hits the extremes of stagnation and deflation, and this is the weakest point the economy hits when the indicators are at their worst.


occurs after economic activity has bottomed and begins to recover, showing a slight and gradual improvement in the stability of economic indicator readings.


This phase comes after the economic recovery, and the real improvement in the results of economic indicators begins and the growth rates of the economy increase significantly.

Interest rates:

 is the rate of return on borrowing, and means the percentage approved by the central bank as the cost of lending to commercial banks in the country and the percentage paid by the central bank in exchange for the deposits made by commercial banks for the purpose of investment.

Expansionary Monetary Policy:

Approved by the Central Bank This is the monetary policy that will be followed in the event of an economic downturn or deflation. This policy is based on increasing the money supply in the country in order to stimulate economic growth.

Contractive monetary policy:

 Monetary policy approved by the central bank and followed when the economy is growing.


This is an increase in the general level of prices of goods and services and a decrease in the purchasing power of money, that is, the purchase of lesser quantities of goods and services for the same amount of money.

Federal Reserve:

 The Federal Reserve is the central bank of the United States of America that is responsible for setting monetary policy and interest rates on the US dollar

European Central Bank: The ECB is the bank responsible for setting the monetary policy of the member states of the European Union or the so-called Eurozone and aims to support price stability and economic growth for the member states.

Bank of England BOI:

 is the UK central bank responsible for is responsible for monetary policy and supports the growth and stability of pound sterling economies

Bank of Japan (BOJ):

The central bank of Japan responsible for setting monetary policy and supporting price stability, the banking system and economic growth in Japan.

Swiss National Bank (SNB):

This is the Swiss central bank that specializes in setting monetary policy and supporting the Swiss franc to serve economic trends, control inflation and increase economic growth rates.

Exchange rate analysis concepts

They are the basic concepts and terms for reading charts of currency rate movements and for the principles of technical analysis

Technical Analysis:

 It is the study of price movement using charts with the aim of predicting the direction of future market movement.

Line Chart:

 It is the simplest and oldest type of chart, it is a drawing that links the closing prices in a certain period of time and is used to show the general direction of the movements of the exchange rates of currency pairs in Forex without knowing the details.

Bar Chart:

This is the most common type of chart where the price movement is represented by columns, the bar is bullish when the closing price is higher than the opening price, and bearish when the closing price is lower than the opening price


The highest price that the currency pair has reached during the period.

Lowest Price:

 The lowest price that the currency pair’s exchange rate has reached during the period.

Opening Price:

 is the exchange rate of the currency pair at the beginning of the period.

Closing rate:

 is the exchange rate of the currency pair at the end of the period.

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