Let’s talk about: Wall Street slangs for the modern day trader

Bear? Barney? To the moon?

It’s almost impossible for even the newest of newbie traders to not have heard of these terms before in their trading journey. These typically unconventional trading vocabularies have now dominated the current trading-sphere as the preferred communication tool for traders all around the globe.

With that said, it’s to our own benefit to educate ourselves on these trendy jargons to be in the know and make trading more efficient. For the old-timers, you can see this as a refresher course to update your vocabs.

Money Zoo

The Bull

The symbol of a bull represents positivity and progress. It is used to describe optimistic investors that believe the general direction of prices in the market trends upwards. For instance, if someone is “bullish”, it means they expect the price to go up, and they may take a long position to profit from that expected increase. In the same way, the popular Charging Bull (or the Wall Street Bull) was placed in the financial district of New York City as an icon of the American dream where anyone can come, work hard, and succeed. 

The Bear

The antithesis to a bullish market is a bearish one, signalling a downward-trending market. Being a bearish trader means that one has pessimistic sentiment about a market and believes the price will drop and tends to sell, making the price even lower. Real world examples include the bursting of the dot com bubble in 2000 and the more recent Covid-19 pandemic outbreak in 2020.

The Whale

A “whale” is a big fish that everyone is keeping their eyes on. They’re the individuals or institutions with deep pockets and enormous buying power. With even just one trade, they can make waves in the investment world, thanks to the size of their capital. Due to their massive capital and influential policies, central banks are considered to be the largest whales in forex. Their policies and operations such as open market operations and interest rate policies have a substantial effect on the forex market. 

The hawks and doves

In the world of trading, there are two camps: the hawks and the doves. These two terms refer to the two opposing views of monetary policy. A “hawkish” monetary policy is one that prioritizes controlling inflation, even if it means raising interest rates which would in turn, slow down economic growth. In contrast, a “dovish” stance is of the opinion that the central bank should lower interest rates, even if it means allowing inflation to rise above the target level temporarily, as the aim is to stimulate economic growth.

Money Couples

Ever heard of the saying: Two is better than one? This also stands true in Forex as currencies come in pairs, just like yin and yang, peanut butter and jelly. Also, who says traders only talk in numbers? Traders can be imaginative and creative too, that’s why they have come up with interesting names for currency pairs. Here’s some well-known examples that you may have come across:

  • Aussie or Ozzie or Matie for AUD/USD
  • Loonie for CAD/USD
  • Cable for GBP/USD
  • Swissy for USD/CHF
  • Barney for USD/RUB
  • Betty for EUR/RUB
  • Ninja for USD/JPY

Money Movements

To the moon vs tanking

This phrase describes skyrocketing prices, which happens rapidly in most scenarios. Often used in a “bullish” context by optimistic traders, they may use it to portray the expectation of a currency pair to continue rising in price and experience an upward trend.

Then we have “tanking” on the other end of the spectrum, which depicts a situation where the value is rapidly depreciating by a large amount and in a short time. Hence, you’ll see the term “tanking” everywhere when there is a steep decline.

Short squeeze vs long squeeze

A short squeeze can occur when a currency pair’s exchange rate rises sharply, causing traders who have bet against the currency (i.e. they have shorted the currency) to exit their trades to limit losses. This can create a buying frenzy, pushing the exchange rate even higher.

A long squeeze in forex happens when the exchange rate of a currency pair drops sharply, causing traders who have gone long (i.e. they have bought the currency in the hope that it will appreciate in value) to exit their trades to limit losses. This can cause selling pressure, pushing the exchange rate even lower.

Now I know my (trading) ABCs

Being familiar with the fundamental stock market terminology and jargon can help boost your confidence when facing the market. Not only can it contribute to analyzing the market dynamics and trends more accurately, it also creates opportunities for traders to communicate their opinions effectively.

So, what are you waiting for? Go show off your new vocabs to your trading peers!

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