Financial Glossary

Backwardation

A theory which says that as a futures contract nears expiry, it will trade at a higher price compared to when it was further from the expiry date. Also see 'Contango'.

Bar chart

A style of chart used in technical analysis, where the top of the vertical line represents the highest price traded in a particular instrument, and the bottom part displays the lowest price. The closing price is shown on the right side of the bar, and the opening price is shown on the left side of the bar. A single bar normally represents one day of trading.

Base currency

The first currency quoted in a currency pair (for example in the GBP/USD currency pair, GBP is the base currency while USD is the quote currency).