What does cable mean in forex

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“Cable” is a slang term for the exchange rate between the U.S. dollar (USD) and the British pound sterling (GBP). The term is used among forex traders. It can also refer to the British pound sterling.

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Answer

What does trading the cable mean in forex?

The slang term “trading the cable” is used by forex traders to refer to an exchange between British pounds and U.S. dollars. The word ” cable ” may refer to the exchange rate between the pound and the dollar, and may also simply refer to the British pound.

Why is the Pound called the cable of forex?

The pound may be called the cable only when it is paired with the USD, not with any other currency. The forex, or foreign exchange, is now a global marketplace for the exchange of nearly all global currencies. It has no headquarters or central location.

What is a cable in finance?

Key Takeaways The cable refers to the British pound (GBP) as it relates to the U.S. dollar (USD), with the exchange rate typically quoted as GBP/USD. The term cable comes from the telegraph days when the pound and dollar were the most traded currencies.

What is the abbreviation for Forex?

Some sources abbreviate Forex even shorter as “FX”. OTC – OTC stands for “over-the-counter.” The Forex market is an OTC market, as there are no centralised exchanges at which currencies are traded.

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What is the cable pair forex?

The slang term “trading the cable” is used by forex traders to refer to an exchange between British pounds and U.S. dollars. The word “cable” may refer to the exchange rate between the pound and the dollar, and may also simply refer to the British pound.


Why do they call Gbpusd cable?

GBP/USD is referred to as cable because of the deep-sea cables which used to carry buy and sell information between London and New York. This information is now exchanged through more sophisticated means – such as satellites and fibre optic cables – but the name continues to be used by forex traders.


What is cable and fiber forex?

If you are trading FX, you have got to know about the Fiber. This is, by far, the most traded FX pair in the world: the EUR/USD. The “Fiber” nickname has two meanings: on one side, it stands as a deviation from the fact that the GBP/USD is called Cable, the Euro being a newer currency.


Why is Eurusd called fiber?

EUR/USD of course doesn’t quite have the same romantic history to draw upon that Cable does. So what do traders do? Well, being the funny bunch that they are, they’ve gone and simply ‘upgraded’ the old Cable to a state of the art Fibre Optic line. Hence the nickname Fibre!


What is Xauusd in forex?

The XAUUSD represents the price of 1 troy ounce of gold in U.S. dollars. In other words, it tells you how many U.S. dollars you would need to buy 1 troy ounce of gold. Over the years, gold has remained an attractive commodity due to its store value, beautiful appearance, and malleability.


How do you read GBP USD?

Understanding the GBP/USD (British Pound/U.S. Dollar) The value of the GBP/USD pair is quoted as 1 British pound per X U.S. dollars. For example, if the pair is trading at 1.50 it means that it takes 1.5 U.S. dollars to buy 1 British pound.


Is Eurusd a Fibre?

EUR/USD also has two other nicknames such as the Euro and Fiber. The name Euro is quite simple when there are two opinions why the name Fiber appeared. Some claim the currency got the name Fiber because of the GBP/USD pair that is called Cable.


What is the meaning of USD JPY?

USD/JPY is the abbreviation used to denote the currency exchange rate for the U.S. dollar and Japanese yen. The currency pair shows how many Japanese yen (the quote currency) are needed to purchase one U.S. dollar (the base currency).


What do you call a professional forex trader?

Forex is short for foreign exchange. Transactions in the forex market are always between a pair of two different currencies. A forex broker may also known be as a retail forex broker or a currency trading broker.


Why is USD JPY called Gopher?

USD/JPY is a currency pair consisti… More is a currency pair consisting of the US dollar and the Japanese yen. This pair is known as “the Yen” or the “Gopher”. It shows how many yen (the quote currency) it costs to purchase one US dollar (the base currency).


What is the nick name of eurusd?

The following nicknames are common: “Swissy” or “Euro-Swissy” for EUR/CHF, Fiber for EUR/USD, Chunnel for EUR/GBP, Loonie and The Funds for USD/CAD, Aussie for AUD/USD, Gopher for USD/JPY, Guppy for GBP/JPY, Yuppy for EUR/JPY pairing.


What is Fibre currency?

There are no wood fibers or starch in currency paper. Instead, like high quality stationery, currency paper is composed of a special blend of cotton and linen fibers. The strength comes from raw materials continuously refined until the special feel of the currency is achieved.


What is the exchange between the British pound and the US dollar called?

Key Takeaways. When the currency pair is the British pound and the U.S. dollar, the exchange may be called “trading the cable.”. The British pound is sometimes known as “the cable,” but only when it is paired with the U.S. dollar.


Is forex a global currency?

Modern Times. The forex, or foreign exchange, is now a global marketplace for the exchange of nearly all global currencies. It has no headquarters or central location. Currency transactions are conducted electronically between traders around the world, 24 hours a day.


What is cable in forex?

The term cable is a slang term used by forex traders to refer to the exchange rate between the pound and dollar and is also used to simply refer to the British pound itself . The term originated in the mid-19th century, when the exchange rate between the U.S. dollar and British pound began to be transmitted across the Atlantic by a submarine …


When was the first transatlantic cable built?

The first Transatlantic Cable was laid under the Atlantic Ocean in 1858, but it failed after only about a month of fitful service. The first truly successful cable across the Atlantic was completed in July 1866, reliably transmitting currency prices between the London and New York City Exchanges.


What is the base currency for forex?

In the forex market, the US dollar is normally considered the base currency for quotes, meaning that quotes are expressed as a unit of $1 USD per the other currency quoted in the pair. The primary exceptions to this rule are the British pound, the euro and the Australian dollar.


What does the bid price mean in FX?

In FX trading, the Bid represents the price at which a trader can sell the base currency, shown to the left in a currency pair. For example, in the quote USD/CHF 1.4527/32, the base currency is USD, and the Bid price is 1.4527, meaning you can sell one US Dollar for 1.4527 Swiss francs.


What is the GBP/USD pair?

The GBP/USD (Gre at British Pound/U.S. Dollar) pair. Cable earned its nickname because the rate was originally transmitted to the US via a transatlantic cable beginning in the mid 1800s when the GBP was the currency of international trade.


What is the base currency for forex?

In the forex market, the US dollar is normally considered the base currency for quotes, meaning that quotes are expressed as a unit of $1 USD per the other currency quoted in the pair. The primary exceptions to this rule are the British pound, the euro and the Australian dollar.


How many times does a forex trader have to buy or sell currency?

One of approximately five times during the forex trading day when a large amount of currency must be bought or sold to fill a commercial customer’s orders. Typically these times are associated with market volatility. The regular fixes are as follows (all times NY):


What is currency trade?

A currency trade which exploits the interest rate difference between two countries. By selling a currency with a low rate of interest and buying a currency with a high rate of interest, the trader will receive the interest difference between the two countries while this trade is open.


What is the GBP/USD pair?

The GBP/USD (Gre at British Pound/U.S. Dollar) pair. Cable earned its nickname because the rate was originally transmitted to the US via a transatlantic cable beginning in the mid 1800s when the GBP was the currency of international trade.


What is a dealer in trading?

An individual or firm that acts as an intermediary, bringing buyers and sellers together for a fee or commission. In contrast, a dealer commits capital and takes one side of a position, hoping to earn a spread (profit) by closing out the position in a subsequent trade with another party.


What is the point at the end of an extreme trend?

A point at the end of an extreme trend when traders who are holding losing positions exit those positions. This usually signals that the expected reversal is just around the corner.


What is CPI in forex?

CPI – The CPI report (Consumer Price Index) is a very important market indicator in Forex. It represents the inflation rate in a country that most major central banks follow when adjusting their monetary policy. The CPI shows the increase in prices of goods and services over a specific period of time.


What does FX stand for?

Some sources abbreviate Forex even shorter as “FX”. OTC – OTC stands for “over-the-counter. ”.


What is the most traded currency in the Forex market?

Greenback – The US dollar is the most heavily traded currency in the Forex market and is included in around 80% of all market transactions as either the base currency or the counter currency. The US dollar is also known by the slang term “greenback”, which refers to the colour of US paper dollars.


What does S/R stand for in forex?

S/R – If you’ve ever read an online Forex market analysis, chances are that you’ve stumbled upon the term “S/R”. This is short for “Support/Resistance”, a major concept of technical analysis. Support levels represent price-levels below the current market price at which bears could have difficulties to break below. Similarly, resistance levels represent price-levels at which bulls may have difficulties to break above.


What is the central bank of the United States?

Central Banks. Fed – Federal Reserve – The central bank of the United States, in charge of the country’s monetary policy. The Fed follows inflation rates, labour statistics, and economic growth to make interest rate decisions. BoC – Bank of Canada, the Canadian central bank.


What does MA mean in trading?

MA is short for “Moving Average” – a technical indicator that averages the prices over a pre-specified period of time and plots the result on your chart in the form of a line. Moving averages are used as a representation of fair value, which means that the market tends to return to its average price over time.


What is the broadest market indicator available for a country?

Macro-fundamentals. GDP – The Gross Domestic Product, or GDP, is the broadest market indicator available for a country. The GDP measures the total value of a country’s output, including goods and services, over a specific period of time (usually one year.)


Why is Forex so popular?

Except for times of major market turbulence, any significant differences in quotes are momentarily negated through an automatic arbitrage. By extension, this also means that any one quote is only valid for a brief second.


Why are spreads good for forex?

Smaller spreads are generally good for Forex traders, as smaller fluctuations in exchange rates make it easier for trades to become profitable. Most traders know that every transition in the Forex market involves buying or selling at the opening of an order – and, reversely, selling or buying at closing.


Why are all currencies quoted in pairs?

The reason for this is simply because in order to express a value of anything, you need something else to compare it to – or in our case, to quote against. For example, EUR/USD is a currency pair where the value of the euro is expressed in US dollars.


Is Forex trading free?

Your Forex quotes are free of charge, as are your price charts, your trading platform, and your access to the market. Your broker makes sure of that, as long as you are using their services. Now that you know how to read Forex quotes, you are one step closer to becoming a real life professional trader.


Why is the US dollar called greenback?

U.S. dollar is called greenback because of the paper notes issued during the American civil war in 1861. Those notes had a distinctive green coloring on the back.


USD second nickname – buck

U.S. dollar is called buck from times when deerskin (male deers are called bucks) was used by American Indians for trading with dollars.


Why is Euro called fiber?

Legend says that the nickname fiber comes from the fact that the paper used for euro banknotes consists of pure cotton fiber which makes it more durable and gives it a special feel.


Why is the British pound (GBP) called sterling?

The British pound is officially called pound sterling and it is not just a nickname. It sometimes gets abbreviated to either pound or sterling. Name sterling comes from times when the British pound had an equal value to one pound of sterling silver.


Why is the Canadian dollar called loonie?

Loonie is a nickname for the Canadian dollar as one dollar coin carries an image of a bird called „loon” which is a popular species in Canada.


Why is the New Zealand dollar called kiwi?

New Zealand dollar has a nickname kiwi which represents the national symbol of New Zealand – a bird called kiwi. It is small, brown, furry, and can’t fly – just like a kiwi fruit.


Why is the euro called the single currency?

Euro is often called the single currency as it is used in 24 European countries. It was first introduced in 1999 and now is the second biggest reserve currency after the U.S. dollar.

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What Is “Cable”?

  • “Cable” is a slang term for the exchange rate between the U.S. dollar (USD) and the British pound sterling (GBP). The term is used among forextraders. It can also refer to the British pound sterling. The word “cable” refers to the early telegraph cables that were laid between London and New York and were used to communicate currency quotes and othe…

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Understanding The Cable

  • “Cable” only refers to the British pound with reference to its trading against the dollar, typically quoted as GBP/USD. Quotes against other currencies such as the euro or the Japanese yen refer to the pound as sterling (not cable), as in “I need a price in sterling/yen” or, “I think euro/sterling will reboundfrom its current lows.” The currency code for the pound is GBP, which stands for Great B…

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Dominant Currency Until The Post-World War II Period

  • The British pound, or pound sterling, is considered the oldest currency still in use. It was the world’s dominant currency for centuries, and thus it was considered the primary reserve currencyin which other nations held their excess cash. As the British Empire dominated global commerce, the pound dominated international finance. It was legal tenderin most colonies, inclu…

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Base Currency

  • In foreign exchange, the base currencyis the one against which another currency is compared. When the pound was the world’s dominant currency, it was also the base currency for trading, so a price quote indicated the amount of currency X that needed to be exchanged for the pound. It is still the base currency in trades against the U.S. dollar, Canadian dollar (CAD), and Japanese ye…

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Examples of How The Cable Has Historically Moved

  • When chartingthe GBP/USD, if the rate is rising it means the GBP is performing better than the USD, or the USD is underperforming the GBP. This is because it is taking more and more USD to buy one GBP. When the GBP/USD rate is falling, that means it costs less USD to buy one GBP, and therefore the GBP is declining in value relative to the USD. The following chart shows the GBP/U…

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