Financial Dictionary

The Ichimoku Cloud is an indicator with five lines that show support, resistance, trend direction and momentum at once. Price above the cloud is read as bullish, and price below it as bearish.

Implied volatility is the market's forecast of how much an asset's price will move, derived from options prices. Rising implied volatility usually signals growing uncertainty.

An income statement shows a company's revenue, costs and profit over a period. Traders use it to judge growth and profitability.

Index rebalancing is the regular review in which an index adds or removes companies and adjusts their weights. Funds that track the index must buy and sell to match, which can move prices around the change.

The Indian rupee is the currency of India, managed by the Reserve Bank of India. Oil prices, foreign fund flows and US interest rates are among its main drivers.

Industrial production measures the output of factories, mines and utilities. It is a guide to the health of the manufacturing sector.

Inflation is the rate at which the general level of prices rises over time. High inflation erodes buying power and usually leads central banks to raise interest rates.

Initial jobless claims count the number of people filing for US unemployment benefits for the first time each week. They are published on Thursdays and give an early read on the jobs market.

Initial margin is the deposit needed to open a leveraged position, usually shown as a percentage of the position's full value. A 5% margin, for example, allows a position 20 times the deposit.

An initial public offering is when a company first sells its shares to the public and lists on a stock exchange. Prices can be volatile in the first days of trading.

An inside bar is a candle whose high and low fall within the range of the previous candle. It shows a pause, and a break of the previous candle's range is often used as a signal.

Insider trading is buying or selling a security using important information that is not yet public. It is illegal in most markets and carries heavy penalties.

An instrument is any tradable asset or contract, such as a currency pair, share, index, commodity or bond.

An interest rate is the cost of borrowing money, shown as a percentage per year. Central bank rates are the biggest single driver of currencies and bond yields.

An interest rate decision is a central bank's announcement on whether to raise, cut or hold its policy rate. Markets react to the decision itself and to the guidance that comes with it.

An interest rate differential is the gap between interest rates in two countries. It is a major driver of exchange rates and of the overnight funding on currency positions.

An inverse head and shoulders is a bullish reversal pattern with three troughs, the middle one lowest. A break above the neckline is read as confirmation.

An inverted yield curve is when short term government bond yields are higher than long term yields. It has often come before recessions in the past.

Investment grade describes bonds rated BBB or above by S&P and Fitch, or Baa or above by Moody's. These bonds are judged to have a relatively low risk of default.

Iron ore is the raw material used to make steel. China is the largest buyer, so its construction activity drives prices, which also affect the Australian dollar.

An Islamic account, or swap free account, does not charge or pay overnight interest, in line with Sharia principles. Providers may apply other fees in its place.

The ISM Manufacturing PMI is a monthly survey of US factory purchasing managers by the Institute for Supply Management. A reading above 50 signals expansion and below 50 signals contraction.