The required equity that an investor must deposit to collateralize a position.
A dealer who regularly quotes both bid and ask prices and is ready to make a two-sided market for any financial instrument.
An order to buy/sell at the best price available when the order reaches the market.
Moving Average Convergence Divergence is a popular technical indicator that was developed by Gerald Appel in the 1970s. It is used to indicate changes in the momentum, direction and duration of an underlying asset’s price action. MACD focuses on the relationship between two moving averages. The first is called MACD line. It is calculated by subtracting the 26 period EMA (exponential moving average), from the 12 period EMA. The second line is known as the signal line, this is a 9 period EMA of the MACD line. Both the MACD line and the signal line are plotted over current price action, and the difference between them is presented in a histogram beneath the chart being monitored.
Refers to investments that are short-term (i.e., under one year) and whose participants include banks and other financial institutions. Examples include Deposits, Certificates of Deposit, Repurchase Agreements, Overnight Index Swaps and Commercial Paper. Short-term investments are safe and highly liquid.
Money supply figures, specifically M1, once were the most important release to watch in the Treasury market, as the Fed directly targeted M1 growth in the early 1980s. The focus on money supply has long since been abandoned, however. To the extent that money supply is still monitored by the market, M2 is the favoured monetary aggregate. The Fed still targets both M2 and M3 in a rhetorical sense, but these targets mean little when it comes to policy decisions. If the Fed misses its target, it is more likely to change the target than it is to change policy. In 2000, the Fed finally abandoned the targets altogether, thereby removing any remaining emphasis on this one-time star release.
Momentum is the rate at which an underlying asset’s price and volume accelerate, either positively or negatively. Once an asset begins to gather momentum it is considered increasingly likely that it will continue to move in the same direction. In technical analysis indicators of momentum are called oscillators and are used to indicate emerging trends.
Monetary Policy Committee is a committee of the central bank that is responsible for the monetary policy decisions.