Glossary
Last updated
Last updated
Indicator: Mathematical tools that traders and investors use to assess past and future price movements on stock charts. These can be based on price, volume, or other market metrics.
Trend: Reflects the predominant direction in which an asset is moving. They are mainly classified as:
Bullish: When the asset price is moving upward.
Bearish: When the asset price is moving downward.
Sideways: When the price moves horizontally without a clear upward or downward direction.
Volume: Represents the total amount of an asset traded in a specified time period. It is a key indicator of asset liquidity and demand.
Support: A price level where an asset has historically had difficulty falling below. It denotes an area where buying pressure tends to be greater than selling pressure.
Resistance: A price level where an asset has historically had difficulty surpassing. It indicates an area where selling pressure could outweigh buying pressure.
Candlestick: A chart that shows the price movement of an asset during a specific period. It represents the opening, closing, high, and low prices during that interval.
Oscillator: A type of indicator that varies over time within a specified range. Common examples include RSI and Stochastic.
Divergence: Occurs when the price of an asset and an indicator move in opposite directions. For example, if the price reaches a new high but the indicator does not, it can be a signal of an impending reversal.
Breakout: When the price moves out of an established range, either above resistance or below support.
Trendlines: Lines drawn on a chart to represent potential support or resistance levels.
Overbought & Oversold: Terms describing market conditions in which an asset has been subject to excessive buying or selling. They are often used with oscillators like RSI.
Stop-loss: An order placed to sell an asset when it reaches a specific price, usually set to limit a loss in a position.
Take-profit: An order placed to sell an asset when it reaches a specific price, used to secure profits.
Spread: The difference between the buying and selling price of an asset.
Accumulation/Distribution: An indicator that provides information about the flow of money into an asset, identifying whether it is accumulating (being bought) or distributing (being sold).
ATR (Average True Range): Measures the volatility of an asset by calculating the difference between highs and lows over a specified period.
Beta: A coefficient that measures an asset's volatility relative to the overall market.
Bollinger Bands: Consist of a moving average with two outer bands representing the price's standard deviation. They help identify volatility and potential reversal points.
Cross: When two lines on a chart, often moving averages with different periods, intersect.
Exponential Moving Average (EMA): A type of moving average that gives more weight to recent prices. It is more sensitive to recent changes compared to a simple moving average.
Fibonacci Retracements: A tool that uses horizontal levels to indicate support or resistance areas at key Fibonacci levels.
Gap: A sudden jump in an asset's price on the chart, due to buying or selling forces. It can be bullish or bearish.
Golden Cross & Death Cross: Refers to the crossing of two moving averages. A Golden Cross occurs when a short-term moving average crosses above a long-term moving average, while a Death Cross is the opposite.
Head and Shoulders: A chart pattern indicating a trend reversal. It can be bullish (inverted) or bearish.
Ichimoku Cloud: A set of lines forming a "cloud" on the chart, providing support, resistance, and trend direction.
Leverage: Financing a position with debt, which amplifies both gains and losses.
MACD (Moving Average Convergence Divergence): A momentum indicator showing the relationship between two moving averages.
Margin Call: A requirement from the broker to add more funds to an account because open positions are approaching insufficient margin.
Pivot Points: A tool that calculates support and resistance levels based on the previous day's high, low, and close prices.
