296 terms

Glossary

Market, chart and broker terms — all in one place, in plain English.

Expectancy

The average result of one trade in units of risk, R, over a series; on a small sample a first reading, not a verdict.

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All-time high (ATH): The highest price an asset has ever traded at; above it there are no levels and no past trades, only open space.
Altcoin: Any coin other than bitcoin; the smaller the coin, the more it follows bitcoin and the harder it falls.
Ask: The best price a seller is prepared to sell at.
Asset: Anything that trades: a share of a company, a currency, an ounce of gold, a digital coin.
ATR (average true range): The average range of a candle over recent periods, usually fourteen, in units of price; a measure of volatility used to place a stop beyond the reach of ordinary noise.
Averaging down: Adding to a losing position at a lower price; the same wrong idea in a bigger size, with the loss at the stop now over the limit the rule allows.

Balance and free margin: Balance is the money in the account with open positions left out; free margin is equity minus the margin held for open positions — the amount still available to open new ones.
Base currency, quote currency: How a forex instrument is written: in EUR/USD the first currency is the base, the one being bought or sold, and the second is the quote, the one the price is stated in; 1.10 means one euro costs 1.10 dollars.
Bid: The best price a buyer is prepared to buy at.
Binary option: A contract with two outcomes: if the condition on the price is met by the appointed moment, the buyer receives a payout agreed in advance; if it is not, the whole stake is lost.
Binary outcome: An outcome with two options — “yes” or “no”, with nothing in between; binary options and event contracts are both built this way: the payout is either full or zero.
Bitcoin (BTC): The first and best-known cryptocurrency: no company or country stands behind it, and its price easily moves 3–4% in a day. BTC/USDT is the price of bitcoin in digital dollars.
Black swan: An event no one expected that overturns the market within hours — a pandemic, a bank collapse; the only protection against it is a position size set in advance.
Blockchain: The shared record of every transfer of a coin, kept by thousands of computers at once and impossible to amend after the fact; what the value of cryptocurrencies rests on.
Blue chips: The shares of the largest, most established companies with a long record — Apple, Microsoft, Coca-Cola; steadier than the rest, and the most liquid.
Body: The thick part of a candle, stretching from the open to the close of the period.
Bollinger bands: A channel of two lines either side of a moving average at a distance set by volatility: it narrows when the market is quiet and widens when it moves; touching a band is a measure of stretch, not a signal.
Bond: A debt in the form of a security: the buyer lends money to a government or a company, receives interest and gets the sum back at maturity; bond prices and interest rates move against each other.
Borrow fee: The charge for shares borrowed to sell short, as a yearly percentage; on heavily shorted stocks it rises, and holding the short gets more expensive.
Break-even: Moving the stop to the entry price once the trade is in profit: the worst outcome from then on is zero minus commission, unless the price gaps over the stop; moving it too early knocks you out of trades that would have worked.
Break-even win rate: The share of winning trades at which a series comes out at zero for a given risk-reward ratio or payout: one third at a 1:2 target, about 56% for a binary option with an 80% payout.
Breakout: The price passing through a level and continuing: up through resistance, or down through support.
Brent and WTI: The two grades of crude oil that serve as the world’s benchmarks: Brent, from the North Sea, the reference for Europe and Asia, and WTI, the American grade; both trade as futures and CFDs and usually move together a few dollars apart.
Broker: The authorized intermediary that gives a private person access to the exchange for a fee.
Bull market, bear market: A market named by the direction of its long move: a bull market when prices have been rising for months and participants expect more, a bear market when they have fallen a fifth or more from the high.
Bullish and bearish candle: Names for a candle by how its period ended: a bullish one closed above its open, a bearish one below. Green and red are only the usual way of drawing them.
Bulls and bears: The names of the two sides of the market: bulls buy and expect a rise, bears sell and expect a fall; the price moves in favor of whichever side is more insistent at the moment.
Buy stop, sell stop: A pending order to buy above the current price or to sell below it; it fills when the price reaches the level — an entry on a breakout.
Buyback: A company’s purchase of its own shares from the market; the number of shares in circulation falls, and the profit per remaining share rises.

Call and put: The two kinds of option: a call gives the right to buy the asset at a set price before a set date, a put the right to sell; a call is bought in expectation of a rise, a put of a fall.
Candle: A mark on a chart that packs one period of trading into four prices: the open, the high, the low and the close.
Candlestick chart: A style of drawing a chart in which every period is one candle; the trades underneath are the same as on a line or bar chart, and only the amount of detail differs.
Capital gain: The income from selling an asset for more than it was bought for; in many countries taxed separately from wages, and trading losses can usually be set against gains.
Carry trade: A trade that holds a currency with a high interest rate against one with a low rate for the difference, credited daily through the swap; a move in the rate against the position can wipe out that difference in days.
Cent account: A forex broker account denominated in cents, with lots a hundred times smaller, so 50 dollars can be traded by the rules without breaking the percentage risk limit.
Central bank and interest rate: The state’s bank — the Fed in the US, the ECB in the eurozone — and the rate it sets at which other banks borrow; a rise usually strengthens the currency and weighs on stocks, a cut does the reverse.
CFD (contract for difference): A contract with a broker on the difference in price: if the price rises, the broker pays you; if it falls, you pay the broker. You do not own the asset itself, so you can also make money on a fall; often with leverage.
Chargeback: The reversal of a card payment at the cardholder’s request through the bank that issued the card; a way to recover money from a venue that will not return it itself — with a filing deadline and no guarantee.
Chart: A record of trades that have already been made, on two axes: price up the side, time along the bottom. Nothing exists to the right of the current moment.
Chart scale: How much time fits on the chart: 1D — a day, 1W — a week, 1M — a month, 1Y — a year. The same asset can fall over a day and rise over a year; the scale also sets how much time one candle covers.
Clearing house: The organization that stands between the buyer and the seller of an exchange trade and guarantees its performance to both; because of it, no one on an exchange needs to know who is on the other side.
Clone firm: A fake website with almost the same name and look as a well-known broker; money sent there is lost. Check the web address in the regulator’s register, not through a link from an ad or a message.
Cognitive bias: A systematic error of thinking that pulls a decision away from the arithmetic in the same way for most people; in trading it shows in position size and at the moment of exit.
Coin and token: A coin lives on its own blockchain — bitcoin, ether; a token is issued on top of someone else’s, usually Ethereum, and serves one project; on an exchange they trade alike.
Cold wallet: A wallet whose private keys are kept offline — on a separate device or on paper; as opposed to a hot wallet in a program or on an exchange.
Commission: The broker’s fee for filling an order; usually charged on each side, in and out.
Commodities: Raw materials and produce traded on exchanges — oil, gas, gold, grain; gold is often called a safe-haven asset.
Compensation scheme: A fund set up by law that returns clients’ money, up to a set amount, when a licensed broker fails; the UK, the EU countries and some others have one, offshore jurisdictions do not.
Compounding: Growth in which profit is added to the capital and the next trade is sized from the larger sum; it works both ways — drawdowns grow with the larger size too.
Confirmation bias: The tendency to notice arguments for one’s idea and to miss those against it; on a chart, seeing levels for an entry and not seeing the invalidation point.
Confluence: Several independent reasons at the same place: a level, the trend on the wider chart, a candle, a quiet calendar. Two moving averages and RSI are computed from the same candles and do not count as separate reasons.
Contango, backwardation: Two states of a futures market: contango, when later contracts are dearer than nearer ones, and backwardation, when they are cheaper; in contango, rolling a long position from contract to contract costs money.
Contract size: The quantity of the underlying asset in one lot or contract: 100,000 units of currency in a standard lot, 100 ounces in a gold futures contract, 1,000 barrels in an oil one.
Contract specification: The instrument’s data sheet at a broker or exchange: contract size, price step and its value, margin required, trading hours, overnight fee; read before the first trade in the instrument.
Copy trading: A broker service under which the trades of a chosen trader are repeated on your account automatically; the risk stays yours, and their past results promise nothing about future ones.
Correction, pullback: A move against the trend after which the trend resumes: a pullback is short, a few candles; a correction is deeper, about a tenth of the price; at the start neither can be told apart from a reversal.
Correlation: A tendency of two prices to move together or in opposite directions; a regularity, not a rule.
Counterparty: The other side of a contract: on a CFD it is the broker itself; on an exchange a clearing house stands between the parties.
Cross pair: A currency pair without the dollar — EUR/GBP, EUR/JPY, GBP/JPY; its spread is wider than a major’s, and its rate is made up of the two dollar rates.
Crossover: The moment a fast moving average passes through a slow one; it confirms a change of trend already under way, and often lies in a range.
Crypto exchange: A venue where coins are bought and sold directly, without a broker, and held in the venue’s custody until moved to a wallet of one’s own.
Cryptocurrency, crypto: Digital money such as bitcoin and ether: no company or country stands behind it, the price rests only on demand and so swings harder than other assets; the market never closes, not even at night or at weekends.
Currencies, forex: The market for exchanging currencies, where an instrument trades as a pair: buying one currency, a participant sells the other at the same time, and the result of the trade is decided by the change in the rate between them.
Curve fitting, overfitting: Adding rules until the test on history looks perfect: the strategy describes past cases, not the market, and breaks live. A real rule has a reason and also works on another stretch of history.

Daily loss limit: A line set in advance — a number of losing trades or a share of the account — after which trading is over for the day.
Day trading: A style in which every position is opened and closed the same day; no overnight fee and no gap risk at the open.
DCA (dollar-cost averaging): Buying for the same sum at regular intervals regardless of the price; an investor’s method, not a trader’s, and not the same as averaging down a losing position.
Demo account: A broker account with virtual money, used to learn the terminal — the order window, the size units, the stop — before the first real order.
Depeg: A stablecoin’s departure from the price it is pegged to — the “dollar” trading at 0.97 or 0.50; a sign that the reserves behind the coin are in question.
Deposit bonus: Money a broker adds to a deposit under turnover conditions that lock it; banned for retail clients in the EU and the UK as an inducement to trade.
Derivative: A contract whose price follows the price of another asset rather than being that asset: a futures contract, an option, a CFD.
DEX (decentralized exchange): A venue for exchanging coins with no owner and no custody of funds: a program on the blockchain executes the trades, and the money never leaves the wallet until the trade itself.
Divergence: A disagreement between price and an oscillator: the price makes a higher high while the RSI makes a lower one; a sign that the move is losing strength, not an instruction to enter.
Diversification: The spreading of a position across many assets so that no single one decides the result.
Dividend: A part of a company’s profit paid out to shareholders, per share held; the company decides whether to pay it, and how much.
Doji: A candle with almost no body: the open and the close at the same price; a sign of balance between the sides; after a trend a hint at a possible reversal, on its own not a signal.
Dollar index (DXY): The dollar’s rate against a basket of six currencies, with the euro making up more than half of the weight; it rises when the dollar strengthens against all of them at once.
Double top, double bottom: A pattern in which the price twice hits the same resistance and fails to get through (top), or twice bounces off the same support (bottom); a reason to look closer, not a signal.
Downtrend: A structure of movement in which each high stands below the one before it and each low stands below the one before it — lower highs and lower lows.
Drawdown: The distance from the account’s high to its current low; the way back needs a larger percentage than the fall took.

Earnings report: A company’s quarterly statement of revenue, profit and outlook; the days around it are the stock’s own high-impact days.
Earnings season: The few weeks after the end of a quarter in which most large companies report; it begins around the middle of January, April, July and October.
Economic calendar: The schedule of releases — rate decisions, employment reports, inflation figures, quarterly earnings — with a date, a time and an impact grade.
Edge: A strategy’s ability to make more than it loses over many trades. It shows only in the numbers: how often you are right, your average win and your average loss.
Engulfing: A pair of candles in which the body of the second completely covers the body of the first in the opposite direction; a bullish engulfing at the bottom of a trend and a bearish one at the top are read as a shift in strength.
Equity: The account balance plus the open, unrealized profit or loss; the number the broker measures against the margin.
ESMA, FCA, ASIC: The financial-market regulators of the European Union, the United Kingdom and Australia: ESMA sets the rules for EU brokers, the FCA licenses and inspects British ones, ASIC Australian ones; a broker’s license is checked in the registers of national regulators (ESMA itself does not license brokers — CySEC and others do).
ETF: An exchange-traded fund — a share in a basket of assets, traded like a stock; the usual way to own an index.
Event contract: A contract with a “yes” or “no” outcome: if the event happens it pays a fixed amount (usually $1), if not — nothing; in the USA such contracts trade on exchanges supervised by the CFTC.
Ex-dividend date: The date from which a buyer of the share no longer receives the coming dividend; on that day the price usually opens lower by roughly its amount.
Exchange: The venue where the orders of buyers and sellers meet and the price is formed.
Execution types: ECN and market maker: Two ways a broker is built: an ECN broker (electronic communication network) passes client orders to outside price providers and charges a commission; a market-maker broker takes the other side of the trade itself and earns the spread.
Exotic pair: A pair of a major currency with the currency of a small or emerging economy — USD/TRY, USD/ZAR; the spread is several times wider, the moves sharper, the overnight fee higher.
Expectancy: The average result of one trade in units of risk, R, over a series; on a small sample a first reading, not a verdict.
Expiry: The moment a contract — a futures contract, an option, a binary option — runs out; after it the position is settled, not carried on.
Exposure: The total the account has at risk across all open positions at once; two trades the same way on correlated assets are a single doubled exposure, not two separate ones.

False breakout, fakeout: The price passing a level and coming straight back inside the old range; at the moment it happens it is indistinguishable from a real breakout.
Fed (Federal Reserve): The central bank of the United States; the eight meetings of its committee each year are the main dates in the economic calendar, because the dollar interest rate sets the price of money for the whole world.
Feelings journal: A word or two noted next to each trade about what you felt: calm, scared, excitement, resentment. After twenty or thirty trades it shows which feelings cost you money.
Fiat: Ordinary state money — the dollar, the euro, the rouble; on crypto exchanges the word for everything that is not a coin.
Fibonacci retracement: A grid of horizontal lines at 38.2%, 50% and 61.8% of the last move, where the end of a pullback is expected; they work in part because many traders watch them.
Fill, execution: The moment an order meets its other side and becomes a trade at a specific price; before the fill an order can be canceled, after it only the position can be closed.
Fixed and variable spread: Two ways a broker sets the spread: a fixed spread does not change and is priced with a margin built in; a variable spread is tighter in quiet hours and widens sharply on news.
Flat: The state of having no open position; for a trader, the default.
FOMC: The Federal Open Market Committee, the body of the Fed that decides the US interest rate; its eight meetings a year are among the main dates in the economic calendar.
FOMO: The fear of missing out: entering after the price has already run, far from the level.
Forward test: Trading the written rules live on paper, as the candles arrive, with no right side of the chart to look at.
Fundamental analysis: Reading the reasons behind the price — company earnings, central-bank rates, the supply of a commodity, changes in the law.
Futures: A contract to buy or sell an asset in the future at a price fixed now.
Futures roll: Closing an expiring futures contract and opening the same one with a later date; on a continuous contract chart that day shows a jump with no trades behind it.

Gambler’s fallacy: The belief that after a run of the same outcome the opposite one is “due”; independent events keep the same odds, and a fifth loss in a row makes the sixth trade no likelier to win.
Gap: A jump in price between the close of one period and the open of the next with nothing traded in between; a stop inside a gap fills at the open.
GDP: Gross domestic product: the value of everything a country produced in a quarter or a year; two quarters of decline in a row are commonly called a recession.
Golden cross, death cross: The fifty-day average crossing above the two-hundred-day average (golden cross) or below it (death cross); late confirmations of a change of trend.
Guidance: Management’s expectations for the company’s revenue and profit over the next quarter or year, announced with the earnings report; the stock often reacts more to the guidance than to the report’s own numbers.

Halving: The halving of the reward for mining bitcoin, written into its code once every four years; it cuts the flow of new coins, and expectations for a year ahead are built around it.
Hammer and hanging man: A candle with a small body at the top and a long lower wick: at the bottom after a fall it is called a hammer and hints at a reversal up; at the top after a rise, a hanging man.
Hawks and doves: Words for a central bank’s leaning: hawks favor a high rate against inflation, doves a low one for growth; a hawkish tone at a meeting strengthens the currency.
Hedging: Opening a position that gains where the main one loses — a short on the index against a portfolio of stocks; protection paid for with part of the profit.
High-impact news: The calendar’s top grade: releases after which the price usually travels a day’s range in minutes, the spread widens and stops fill with slippage.
Hindsight bias: The feeling that the outcome was obvious in advance, which appears only after the outcome is known; in a trade journal it shows up as “I saw it coming”.

Inactivity fee: A monthly charge a broker takes from an account after a set period without trades.
Indicator and oscillator: An indicator is a calculation on past prices drawn on or below the chart; an oscillator is the kind that swings inside a fixed scale (RSI from 0 to 100) and flags a stretched move.
Indices: A single number that shows how the prices of a whole group of companies move on average: the S&P 500 tracks the 500 largest US companies. The index itself cannot be bought — it is traded through a contract on its price or a fund that copies it.
Inflation and CPI: The rise in the prices of goods and services over a year, and the consumer price index that measures it; the higher the inflation, the likelier a rate rise, which is why a CPI release moves currencies, indices and gold.
Invalidation: The price at which the reason for a trade stops being true; the place where the stop belongs.
Investing and trading: Two ways of being in the market: an investor buys an asset for years for the growth of the business and dividends; a trader opens and closes trades in minutes, days or weeks for the move in price.
Investor: Someone who buys an asset for years and waits for the company or the whole market to grow, without trying to guess price moves.
IPO: An initial public offering: the day a company’s shares are first sold to the public and begin trading on an exchange; the first weeks are the least predictable of a stock’s life.
Isolated and cross margin: Two margin modes on a crypto exchange: with isolated margin a position’s loss is limited to the sum set aside for it; with cross margin the whole account holds off its liquidation — and the whole account can go.

KYC: “Know your customer” — the identity check a licensed broker must complete before money moves: an ID document, proof of address, sometimes the card used.

Lagging indicator: The textbook name for trend-following indicators such as moving averages, as opposed to “leading” oscillators such as RSI; in practice both are arithmetic on past prices and both turn after the price.
Level: A price at which the market has turned more than once: a record of where trading stalled before — not a wall, and not a guarantee.
Leverage: The ability to trade a sum larger than your own; it amplifies both the profit and the loss.
Limit order: An order to be filled only at a named price or better: it waits at that level and may never fill.
Line chart and bar chart: Two other ways of drawing the same trades as candles: a line joins the closing prices and shows nothing else; a bar is a vertical stroke from the low to the high with the open ticked on the left and the close on the right.
Liquidation price: The price at which the exchange will forcibly close a leveraged position because the margin behind it is no longer enough; the larger the leverage, the closer it sits to the entry price.
Liquidity: A measure of how easily an asset can be bought or sold without moving its price.
Live account: A broker account with real money in it, as opposed to a demo.
Long: A purchase made in expectation of a rise: bought lower, sold higher.
Losing streak: Several losing trades in a row; every honest method has them regularly, and a streak by itself does not say the method is broken.
Loss aversion: The tendency to feel a loss more strongly than a gain of the same size; because of it losing trades are held longer than planned and winning ones closed sooner.
Lot: The unit of size in forex: a standard lot is 100,000 units of the first currency, a mini lot 10,000, a micro lot 1,000.

MACD: Moving average convergence/divergence: the difference between a fast and a slow EMA, drawn as a line and a histogram under the chart; the line crossing zero is read as a change of trend.
Majors: The most traded currency pairs, all against the dollar: EUR/USD, GBP/USD, USD/JPY, USD/CHF, AUD/USD, USD/CAD, NZD/USD; the tightest spreads and the deepest liquidity.
Margin: The part of your money a broker sets aside against an open trade: the trade size divided by the leverage. It cannot be spent while the trade is open, and it is not the risk — the stop sets the risk.
Margin account: A broker account on which you can trade with borrowed money against your own as collateral — with leverage and going short; a cash account buys only with your own money and only long.
Margin call: The broker’s demand to add money or close positions when the open loss has eaten most of the margin.
Margin level: Equity as a percentage of the margin the open positions require; the margin call and the stop-out are set at levels of it.
Market capitalization: The value of a whole company or a whole coin: the price of one share multiplied by the number of shares; in crypto, the coin’s price times the number of coins in circulation.
Market depth: The volume of orders at each price level of the order book; it shows how much can be bought or sold without moving the price — the deeper the market, the smaller the slippage.
Market maker: A participant who keeps both a bid and an ask in the book at all times and earns the spread; thanks to them a trade finds its other side even when no one else is there.
Market order: An order to be filled now, at the best price available: on an open market it fills almost at once, but at the price that exists at the moment of the fill, not the moment of the decision.
Martingale: A sizing scheme in which the stake is doubled after every loss so that a single win recovers everything; a losing streak under it empties an account faster than any other method.
Maximum drawdown: The deepest fall from a high to a subsequent low in an account’s history.
Minimum trade size: The smallest position a broker lets you open — a micro lot, a fraction of a contract or of a coin; it decides whether a small account can keep the one-percent rule.
Momentum: The speed and strength of a price move: long candles in one direction with small wicks; measured by oscillators such as RSI and MACD.
Moving average: The average of the last few closes — twenty, say — recalculated every candle and drawn as a line; it smooths the noise and lags.
Multi-timeframe analysis: Reading one asset on a higher and a lower timeframe: the direction and the levels from the higher one, the entry point and the stop from the lower.

Negative balance protection: The rule that a retail client’s loss stops at zero and cannot become a debt to the broker; in force for retail CFD accounts in the EU and the UK. Futures have no such protection.
Network fee, gas: The charge for recording a transfer on the blockchain, paid to those who run the network rather than to an exchange; on the Ethereum network it is called gas, and it rises when the network is congested.
Non-farm payrolls (NFP): The monthly US report on jobs created outside farming, published most often on the first Friday of the month; one of the strongest releases for the dollar and the indices.

OCO (one-cancels-the-other): A pair of orders in which the fill of one automatically cancels the other; used to link the stop-loss and take-profit of a position, or two entries either side of a range.
Offshore broker: A broker licensed in a jurisdiction where supervision is weak or nominal — St Vincent, Vanuatu, the Marshall Islands; when there is a problem with withdrawal there is, in effect, no one to appeal to.
OHLC: The order in which the four prices of a candle are always named: open, high, low, close.
One-percent rule: Capping the loss at the stop on any single trade at one percent of the account; the position size follows from that number and the distance to the stop.
OPEC: The Organization of the Petroleum Exporting Countries; its decisions on production quotas are one of the main drivers of the oil price.
Option: A contract giving the right, not the obligation, to buy (a call) or sell (a put) an asset at a set price before a deadline; the buyer pays a premium for the right and can lose no more than that.
Option premium: The price the buyer of an option pays the seller for the right; for the buyer the most that can be lost, for the seller the most that can be earned.
Order: An instruction to the broker to buy or sell: what to trade, which direction, how much. It becomes a trade only once the market fills it.
Order book: The list of limit orders to buy and to sell resting on an exchange at each price; the top of the book is the best bid and the best ask, with the spread between them.
OTC (over the counter): Trading without a single exchange, directly between two parties; forex and CFDs work this way, with the broker as the other side of the trade.
Out-of-sample: Data the rules were not tuned on — another asset, another period; a rule that helps there too is probably real.
Overbought, oversold: RSI readings above 70 and below 30: the move is stretched and likelier to pause, though in a strong trend it can stay stretched for weeks.
Overlap: The hours when two sessions are open at once; London and New York together are the busiest of the day.
Overnight fee, swap, rollover: The fee for each night a CFD stays open: the broker acts as if it lends you money and charges interest on the whole trade, not on the margin; on forex it is occasionally a credit in your favor instead.
Overtrading: Trades beyond the plan — on weak set-ups, out of boredom or after a loss; visible in the journal as a rising number of trades with a falling average R.

P/E and EPS: Two numbers from the fundamental analysis of a stock: earnings per share (EPS), the company’s annual profit divided by the number of shares, and P/E, the share price divided by EPS — how many years of profit the market pays for the company.
Paper trading: Trades written down without money, at real prices, with a real stop and target; a way to test the rules before opening an account, but without the pressure of a real loss.
Partial close: Closing part of a trade before the target — say, half of it halfway there — and moving the stop on the rest to the entry price; it cuts both the risk and the possible gain, and is decided in advance, in the plan.
Partial fill: The filling of only part of an order’s volume because fewer opposing orders were available at that price; the rest of a limit order keeps waiting, the rest of a market order fills at the next price.
Patterns: Named shapes on a chart — a triangle, a flag, a head and shoulders; many traders watch them, which is part of why they sometimes work.
Payout: The fixed return a binary option pays on a correct call, quoted as a percentage of the stake; a wrong call loses the whole stake.
Pending order: An order that waits for its price: a stop order to buy above the market or to sell below it, an entry on a breakout; a limit order, an entry on a pullback; it lasts until canceled or until the end of the day.
Perpetual futures and funding rate: A crypto exchange contract with leverage and no expiry; to keep its price tied to spot, one side pays the other a funding rate — usually every 8 hours, more often on some exchanges; longs pay shorts when the market is overheated.
Phishing: Extracting passwords, codes and seed phrases through fake emails, sites and messages made to look genuine; the site address and the sender are the first things to check.
Pig butchering, romance investment scam: A fraud in which the scammer spends weeks building an acquaintance in messages, then leads the victim to a fake trading platform where the “profit” is drawn on screen and withdrawal is impossible.
Pip: The standard unit of a currency pair’s move: 0.0001 for most pairs, 0.01 for pairs with the yen; most brokers quote one digit finer, and that fifth digit is a tenth of a pip.
Pip value, tick value: The amount, in the account currency, by which a position’s result changes when the price moves one minimum step; on a standard lot of EUR/USD one pip is worth 10 dollars, on a micro lot 10 cents.
PnL (profit and loss): The line in the terminal that shows the result: unrealized for an open position, changing with the price; realized for closed ones, over a day or a period.
Ponzi scheme: A scheme that pays earlier participants with the money of later ones, passing it off as income from trading or investment, and collapses when the flow of new money stops.
Portfolio: Everything a participant holds, taken together: stocks, coins, the money in the account; results are counted for the portfolio, not for one position.
Position: An open trade, held from the fill until the close; it gains or loses with every move of the price.
Position size: The amount a trade is opened for, worked out from the risk and the stop: with a $10 risk and a stop 2% from the entry, the trade is $500. The stop further away — a smaller trade, the same risk.
Pre-market and after-hours: The hours of stock trading before the exchange opens and after it closes: thin liquidity, wider spreads, and the place where the price reacts to a company’s earnings.
Prediction market: A market in which contracts on the outcome of future events are traded — elections, matches, rate decisions; the contract price, between $0 and $1, reads as the participants’ own estimate of the probability of the outcome.
Price action: Reading the chart by price alone — candles, levels, structure — without indicators.
Priced in: The state in which an expected event is already reflected in the price: if the market expected a rate rise and it is announced, the price may not move, or may go against the “obvious”.
Profit factor: The sum of all profits divided by the sum of all losses over a series; above one the method is ahead, below one it is behind.
Prop firm: A company that lets you trade its money for a share of the profit after a paid evaluation with drawdown limits, daily and overall; breaking a limit ends the evaluation.
Pump and dump: A scheme in which a group runs up the price of a small coin with purchases and talk, then sells everything to whoever came last; on the chart, a rocket candle up and one just like it back down.
Pyramiding, averaging up: Adding to a trade that is going to plan and already in profit: each addition is smaller than the last, the stop on the whole position is raised, and the total risk to the stop stays no bigger than at the start.

Quote: The current price of an asset stated as two numbers, bid and ask; a chart usually draws only one of them, most often the bid.

R, R-multiple: The unit of a trade’s result: one R is the distance from the entry to the stop, so a loss at the stop is −1R and a target at 1:2 is +2R.
Rally: A fast and sustained rise in price, often after a fall; a word about speed and extent, not about cause.
Range, consolidation: A state of the market in which the price moves inside a band, between a rough ceiling and a rough floor, making neither higher highs nor lower lows.
Recency bias: The tendency to give the latest events more weight than they deserve: raising the size after three wins, skipping a good set-up after three losses.
Recession: A period in which a country’s economy shrinks rather than grows; stocks usually fall ahead of it, on the expectation, not at the announcement.
Recovery scam: A second fraud on the victims of a first one, by “lawyers” or a “recovery service” who ask for a fee up front; a genuine recovery goes through the bank, the regulator or the police and needs no advance payment.
Regulator: The public body that licenses brokers, inspects them and keeps a register in which a license can be checked by its number.
Rejection: The price turning back from a level it reached and failed to hold beyond; the mark it leaves on the candle is a long wick towards that level.
Requote: A broker’s refusal to fill a market order at the price shown, with a new price offered instead; common in fast markets with brokers who execute by hand.
Resistance: A price where rises keep stopping: sellers appear, and buyers refuse to pay more.
Retest: The price’s return to a broken level from the other side: former resistance is tested as support; if it holds, the breakout is confirmed; if the price passes back through, it was false.
Revenge trading: A new, usually bigger trade taken straight after a loss to win it back; the loss decides, not the chart.
Reversal: A change in the direction of the trend: an uptrend stops making higher highs and makes a low below the previous one, or the reverse; confirmed only after it has happened.
Risk capital: Money whose loss would change nothing in a person’s life; the only money to open a trading account with.
Risk management: The set of limits a trader places in advance: how much one trade, one day and one series may lose.
Risk of ruin: The probability of losing the account down to a level from which trading on is impossible, for a given risk per trade and win rate; for a method with a positive edge, close to zero at one percent risk per trade and high at ten percent for any realistic win rate; with a negative edge it equals one at any risk size.
Risk per trade: The amount of money one trade is allowed to lose if the stop is hit; a small share of the account, decided before the size is worked out.
Risk-reward: The ratio of what a trade risks to what it stands to gain: the distance from the entry to the stop-loss against the distance from the entry to the target, written with the risk first — 1:2 means one unit risked for two in prospect. The distance to the stop is also called one R.
Round numbers: Prices ending in zeros — 100 dollars, 1.2000 on the euro, 50,000 on bitcoin; orders and stops cluster there because people think in round numbers, and they often behave like levels.
RSI (relative strength index): An indicator of speed: recent gains against recent losses, put on a scale from 0 to 100.

Safe haven: An asset money moves into in anxious periods because it is expected to hold its value; gold is the classic one.
Sample size: The number of trades a method is judged by: twenty checks whether the rules can be followed, a hundred gives a first number, a thousand a settled one.
Scalping: A style of trading in seconds and minutes for a few pips; dozens of trades a day, in which the spread and the commission are the main opponent.
Seed phrase: A set of 12–24 words that restores access to a crypto wallet; whoever knows the phrase owns the coins, and no exchange or support service ever asks for it.
Segregated account: A bank account in which a licensed broker keeps client money apart from its own, so that the broker’s failure does not take it.
Sentiment: The overall mood of participants, fear or greed; measured by surveys, by the ratio of longs to shorts, by the fear-and-greed index; at the extremes it reverses more often than it continues.
Series drawdown limit: A drawdown set in advance — in R or as a share of the account — after which a series of trades is stopped for review rather than continued “until it bounces”.
Set-up: The specific picture on the chart in which the strategy allows a trade.
Settlement: The closing of a contract at its expiry, by delivery or by payment of the difference; a futures position not closed before then is settled or rolled.
Short: A sale made in expectation of a fall: sold higher, bought back lower.
Short covering: Buying back an asset sold short earlier, which closes the short position; mass buying back at stops drives the price up — that is a short squeeze.
Short squeeze: A sharp rise in price caused by short sellers being forced to buy back at their stops, their buying pushing the price higher still.
Simulator: The section of the platform with a live chart and a virtual account: trades open and close at real prices, the money is not real, the result is counted as on an account.
Slippage: The difference between the price at which an order was meant to fill and the price at which it actually filled.
SMA and EMA: Two flavors of moving average: the simple one weights every close equally, the exponential one weights recent closes more and turns a little sooner.
Smart contract: A program on a blockchain that executes the terms of a deal by itself when they are met; decentralized exchanges, staking and tokens run on it.
Spot: Buying at the full price — the asset genuinely becomes yours.
Spread: The gap between the best seller’s price and the best buyer’s — part of the cost of a trade.
Stablecoin: A coin built to stay worth about one unit of a currency, usually $1 — for example USDT. A private company issues it, so it is not a bank deposit.
Staking: Locking coins in a network to earn a reward for helping confirm its transactions; while locked the coins cannot be sold, and their price keeps moving.
Stochastic oscillator: An oscillator that shows where the latest close sits inside the range of the last N candles (usually fourteen), as a number from 0 to 100: near 100 is at the top of the range, near 0 at the bottom.
Stock split: The division of each share into several: a 1,000-dollar share becomes ten at 100; the value of the holding does not change, only the price of one share on the chart.
Stocks: A share in a company; the price depends on how the business is doing.
Stop hunt: A brief poke through a level where stops have clustered, followed by a return: the stops are filled, the price goes back the way it came; the more obvious the level, the more often it happens.
Stop-limit order: An order that turns into a limit order when the price touches a set level and fills no worse than a second, named price; it protects against slippage, but in a fast market it may not fill at all.
Stop-loss: An order that closes the position when the price reaches a level set against you; placed together with the entry, not after it.
Stop-out, liquidation: The broker closing positions at the market price because the open loss has left too little margin; on crypto exchanges, liquidation.
Strategy: A written set of rules that decides every trade the same way: market, trend, set-up, entry, stop, target, size, and when not to trade.
Strike price, strike: The price at which an option gives the right to buy or sell the asset. In a binary option, the price the asset is compared with at expiry.
Supply and demand: The cause of every move in price: more buyers willing to pay than sellers willing to sell, and the price rises; more sellers, and it falls.
Support: A price where falls keep stopping: buyers step in, and sellers will not accept less.
Swap-free (Islamic) account: An account on which the broker charges no overnight fee; a commission or a time limit sometimes stands in its place.
Swing high and swing low: The turning points on a chart — the high and the low by which the structure of a trend is read.
Swing trading: A style of trading over days and weeks, from the low to the high of one swing; few trades, wider stops, the chart watched by hours and days, not minutes.

Take-profit: An order that closes the position with a gain when the price reaches a target set in advance.
Tax residency: The country whose rules a person pays income tax under, trading income included; usually decided by the number of days spent in the country in a year, not by citizenship.
Technical analysis: Reading the price itself — candles, trends, levels, volume and indicators — on the claim that the marks the past leaves repeat often enough to be worth reading.
Testing on history, backtest: Running the written rules over a past chart, candle by candle: where the rules would have entered and how each trade would have ended. It takes at least 30 trades, and the past always looks better than live trading.
Tick: The smallest change in price a terminal shows: usually one cent in stocks, a fraction of a pip in forex.
Ticker: The short name of an asset, for example AAPL for Apple or BTC for bitcoin.
Tilt: The state after a loss in which every decision serves to undo the loss; not recognizable from the inside, and so capped from the outside by a daily limit.
Time in force (GTC, day order): The rule for how long a pending order lives: until the end of the trading day (day) or until canceled (GTC, good till canceled); a forgotten GTC order fills without you.
Timeframe: The stretch of time one candle covers: a “15-minute timeframe” means each candle is 15 minutes. The wider the chart’s scale, the longer each candle; on a “daily timeframe” each candle is one day.
Trade plan, trade card: Five lines written before the entry: asset and direction, why, entry, stop and target, risk and size. A written plan is hard to break without noticing.
Trade review: Three questions after the close: did I follow the plan, where and why did I depart from it, what will I do the same next time and what differently. A good trade is one where the plan was kept, even at a loss.
Trader: Someone who buys and sells for the difference in price and holds a trade from a few minutes to a few months.
Trading: Buying and selling on a market for the difference in price: buy lower, sell higher and the difference is yours; if the price goes the other way, the difference is a loss.
Trading account: The account at a broker that holds the money for trading and shows what is already bought; the platform shows two numbers for it — balance and equity.
Trading bot, expert advisor: A program that opens and closes trades by set rules with no human involved; in MetaTrader called an expert advisor; it does exactly what its rules say — into losses as well.
Trading halt, circuit breaker: A pause an exchange declares when the price falls sharply or ahead of news about the issuer, to stop a panic; on US exchanges a market-wide halt comes at falls of 7%, 13% and 20% in the S&P 500 within a day.
Trading journal: A list of every trade: asset, direction, entry, stop, target, exit, result and a short note — whether the plan was kept and what you felt. One trade tells you nothing; after twenty, the journal shows where you break your own plan.
Trading plan: A single page that fixes in advance the market and hours, the style, the entry rules, the stop and target, the risk and when not to trade; a rule that is not written down does not exist.
Trading platform: The program through which orders are placed and the chart is watched: MetaTrader 4 and 5 at most forex brokers, the venue’s own at exchanges and crypto exchanges; the order window is the same everywhere — asset, side, size, stop, target.
Trading session: The hours in which a financial center is open — Asia, London, New York — each with its own turnover and character.
Trading signals: Ready-made instructions — “buy here, stop there” — sold or given away by channels and services; the responsibility for the trade stays with whoever opens it, and most signals have no verifiable record.
Trailing stop: A stop-loss pulled along behind the price while the trade is in profit — by hand under each new low, or automatically at a set distance. It only ever moves toward profit, never back.
Trend: The direction the price keeps going for a long time: each high and each low above the last — an uptrend; below — a downtrend. It is seen only in hindsight.
Trendline: A straight line drawn through two or more lows of an uptrend or highs of a downtrend; a sloping level the price returns to.
Triangle: A pattern in which the swings narrow: highs and lows converge and the price coils before breaking out, but which way it will break is not known in advance.
Two-factor authentication (2FA): Logging in with a password plus a second code — from a phone app or a hardware key; without it a stolen password opens the whole account.

Underlying asset: The thing whose price a trade follows: a stock, a currency, a coin, gold, an index. It answers “what you trade”; a CFD, a future and an option answer “how”.
Unrealized and realized: The profit or loss on an open position, which changes with every move of the price — as opposed to the result locked in by the close.
Uptrend: A structure of movement in which each high stands above the one before it and each low stands above the one before it — higher highs and higher lows.

VIX: The volatility index: the expected range of the S&P 500 over the coming month, derived from option prices; called the “fear index” because it rises when the market falls.
Volatility: The amount by which the price of an asset deviates from its average over a period: the higher it is, the wider the range the price can cover, and the higher the risk of a position.
Volume: The amount of an asset traded during a period: a measure of participation, not of direction; the currency market has no single exchange, so there a terminal shows the number of price changes instead.

Wallet: A place to hold coins off the exchange: a program or a device with a private key no one else has; losing the key loses the coins with no way back.
Whale: A participant with a position so large that a single order of theirs moves the price; on small coins the main cause of sudden candles.
Whipsaw: The price moving both ways in a short time, hitting stops on both sides; typical of the minute after a release and of moving-average crossovers in a range.
Wicks, shadows: The thin lines above and below the body of a candle: they reach the high and the low of the period and mark a price the market tried but failed to hold.
Win rate: The share of trades closed at a profit; on its own it decides nothing — only together with the size of wins against losses.
Withdrawal: Moving money from the broker account back to a card or a wallet; the time, fee and conditions of withdrawal are the first things a broker review checks, because it is at withdrawal that doubtful venues show themselves.

Yield: An asset’s yearly income as a percentage of its price: a bond’s payments over its price, a stock’s dividend over its price; the yield on ten-year US bonds is a reference point for every market at once.