Trading Encyclopedia — A–Z Glossary

A

Candlestick Patterns

Abandoned Baby

Doji gapped away from prior and next candles — rare reversal.

A

Portfolio Management

Active Investing

Strategy of selecting individual securities to beat the market.

A

Technical Analysis

ADX

Average Directional Index — measures trend strength.

A

Stock Market

After Hours Trading

Trading outside regular stock exchange hours.

A

Commodities

Agricultural Commodities

Farm products traded as futures — wheat, corn, soybeans.

A

Crypto & Digital Assets

Airdrop

Free distribution of tokens to wallet addresses.

A

Trading Platform

Algorithmic Trading

Using programs to automatically execute strategies.

A

Portfolio Management

Alpha

Excess return above benchmark performance.

A

Crypto & Digital Assets

Altcoin

Any cryptocurrency other than Bitcoin.

A

Forex

AML

Anti-Money Laundering — regulations to prevent illegal fund flows.

A

Psychology

Anchoring Bias

Over-relying on the first piece of information encountered.

A

Trading Platform

API Trading

Connecting custom software to broker systems via API.

A

Forex

Appreciation

Increase in a currency's value relative to another.

A

Forex

Arbitrage

Exploiting price differences across markets for risk-free profit.

A

Technical Analysis

Ascending Channel

Upward-sloping parallel lines framing price.

A

Technical Analysis

Ascending Triangle

Flat resistance with rising support — typically bullish.

A

Forex

Asian Session

The forex session covering Tokyo, Sydney, and Asian markets.

A

Forex

Ask Price

The price at which you can buy an asset.

A

Portfolio Management

Asset Allocation

Strategy of dividing investments among asset categories.

A

Derivatives & Options

At the Money

Option where strike price equals current price.

A

Technical Analysis

ATR

Average True Range — measures market volatility.

B

Trading Platform

Backtesting

Testing a strategy on historical data.

B

Commodities

Backwardation

Futures price lower than spot price.

B

Forex

Balance

Total funds in a trading account excluding open P/L.

B

Forex

Base Currency

The first currency in a pair.

B

Indices & ETFs

Bear Market

Market with falling prices — typically 20%+ decline.

B

Technical Analysis

Bearish Engulfing

Candlestick pattern where a red candle fully covers the prior green.

B

Candlestick Patterns

Belt Hold

Single candle pattern with no shadow on one side — strong conviction.

B

Portfolio Management

Benchmark

Standard against which portfolio performance is measured.

B

Portfolio Management

Beta

Measure of asset's sensitivity to market movements.

B

Forex

Bid and Ask

Bid: sell price. Ask: buy price.

B

Forex

Bid Price

The price at which you can sell an asset.

B

Stock Market

Bid-Ask Spread Stock

Difference between highest buy and lowest sell price for a stock.

B

Derivatives & Options

Binary Option

All-or-nothing option with fixed payout.

B

Crypto & Digital Assets

Bitcoin

First and largest cryptocurrency by market cap.

B

Crypto & Digital Assets

Blockchain

Distributed ledger recording transactions across nodes.

B

Indices & ETFs

Blue Chip

Large well-established company with reliable performance.

B

Macroeconomics

BOE

Bank of England — UK's central bank.

B

Macroeconomics

BOJ

Bank of Japan — Japan's central bank.

B

Technical Analysis

Bollinger Bands

Volatility indicator with a moving average and two bands.

B

Fundamental Analysis

Book Value

Net asset value of a company — assets minus liabilities.

B

Risk Management

Break Even

Point where total gains equal total losses.

B

Technical Analysis

Breakdown

Price falling below a support level.

B

Technical Analysis

Breakout

Price moving beyond a defined support or resistance level.

B

Commodities

Brent Crude

International crude oil price benchmark.

B

Indices & ETFs

Bull Market

Market with rising prices and optimistic sentiment.

B

Technical Analysis

Bullish Engulfing

Candlestick pattern where a green candle fully covers the prior red.

B

Order Types

Buy Limit

Order to buy at or below a specified price.

B

Order Types

Buy Stop

Order to buy above current market price.

B

Stock Market

Buyback

Company purchasing its own shares from the market.

C

Derivatives & Options

Call Option

Right to buy an asset at a set price before expiry.

C

Technical Analysis

Candlestick

Shows open, high, low, and close for a period.

C

Forex

Carry Trade

Borrowing in a low-rate currency and investing in a high-rate one.

C

Technical Analysis

CCI

Commodity Channel Index — identifies cyclical trends.

C

Forex

Cent Account

Account where balance is displayed in cents.

C

Economics

Central Bank

Institution managing monetary policy.

C

Crypto & Digital Assets

CEX

Centralized Exchange — traditional crypto exchange with order book.

C

Forex

CFD

Contract for Difference — trade on price movement without ownership.

C

Technical Analysis

Channel

Parallel lines containing price movement.

C

Technical Analysis

Chart Pattern

Recognizable shape on a price chart that suggests future movement.

C

Stock Market

Circuit Breaker

Temporary halt in trading after extreme price moves.

C

Psychology

Cognitive Bias

Systematic pattern of deviation from rational thinking.

C

Crypto & Digital Assets

Cold Storage

Offline crypto storage for maximum security.

C

Forex

Commission

Fee charged per trade by the broker.

C

Commodities

Commodity

Raw material traded in standardised contracts.

C

Psychology

Confirmation Bias

Seeking information that supports your existing belief.

C

Commodities

Contango

Futures price higher than spot price.

C

Technical Analysis

Continuation Pattern

Chart pattern signalling the trend will resume.

C

Technical Analysis

Convergence

When price and an indicator move in the same direction.

C

Commodities

Copper

Industrial metal often seen as economic bellwether.

C

Forex

Copy Trading

Automatically replicating trades of experienced traders.

C

Forex

Correlation

Statistical measure of how two currency pairs move together.

C

Risk Management

Counterparty Risk

Risk that the other party in a trade may default.

C

Derivatives & Options

Covered Call

Selling a call option while owning the underlying asset.

C

Economics

CPI Consumer Price Index

Tracks average change in consumer prices.

C

Forex

Cross Pair

A currency pair that does not include USD.

C

Commodities

Crude Oil

Most traded commodity — WTI and Brent benchmarks.

C

Crypto & Digital Assets

Cryptocurrency

Digital currency secured by cryptography.

C

Technical Analysis

Cup and Handle

Rounded bottom followed by a small pullback — bullish.

C

Forex

Currency Basket

Weighted set of currencies used as a reference.

C

Forex

Currency Pair

Two currencies quoted against each other.

C

Macroeconomics

Current Account

A country's net trade plus transfers and investment income.

C

Trading Platform

Custom Indicator

User-created technical indicator for MT5.

D

Candlestick Patterns

Dark Cloud Cover

Bearish two-candle reversal opening above prior close.

D

Indices & ETFs

DAX

Germany's primary stock index — 40 largest companies.

D

Order Types

Day Order

Order that expires at the end of the trading day.

D

Forex

Day Trading

Opening and closing positions within the same trading day.

D

Forex

Dealing Desk

A broker model where orders are processed internally.

D

Technical Analysis

Death Cross

50-day MA crossing below 200-day MA — bearish signal.

D

Fundamental Analysis

Debt to Equity

Total debt divided by shareholder equity.

D

Crypto & Digital Assets

DeFi

Decentralized Finance — financial services on blockchain.

D

Macroeconomics

Deflation

General decline in prices across the economy.

D

Derivatives & Options

Delta

Rate of change of option price relative to underlying.

D

Technical Analysis

Demand Zone

Area where buying pressure is expected to emerge.

D

Forex

Demo Account

Practice account with virtual funds.

D

Forex

Depreciation

Decrease in a currency's value relative to another.

D

Trading Platform

Depth of Market DOM

Real-time display of pending orders at price levels.

D

Derivatives & Options

Derivative

Financial contract deriving value from an underlying asset.

D

Technical Analysis

Descending Channel

Downward-sloping parallel lines framing price.

D

Technical Analysis

Descending Triangle

Flat support with falling resistance — typically bearish.

D

Forex

Devaluation

Deliberate downward adjustment of a currency's value.

D

Crypto & Digital Assets

DEX

Decentralized Exchange — trade crypto without intermediary.

D

Technical Analysis

Divergence

When price and an indicator move in opposite directions.

D

Risk Management

Diversification

Spreading risk across multiple assets or strategies.

D

Fundamental Analysis

Dividend

Portion of company profits paid to shareholders.

D

Stock Market

Dividend Stock

Stock that regularly pays dividends to shareholders.

D

Fundamental Analysis

Dividend Yield

Annual dividend per share divided by stock price.

D

Candlestick Patterns

Doji

Candle where open and close are nearly equal.

D

Portfolio Management

Dollar Cost Averaging

Investing fixed amounts at regular intervals.

D

Technical Analysis

Double Bottom

Bullish reversal pattern with two troughs at similar levels.

D

Technical Analysis

Double Top

Bearish reversal pattern with two peaks at similar levels.

D

Macroeconomics

Dovish

Favoring lower interest rates to stimulate growth.

D

Indices & ETFs

Dow Jones

Index of 30 major US industrial companies.

D

Technical Analysis

Dow Theory

Foundation of technical analysis based on market trends.

D

Technical Analysis

Downtrend

Series of lower highs and lower lows.

D

Candlestick Patterns

Dragonfly Doji

Doji with long lower shadow and no upper shadow.

D

Risk Management

Drawdown

Peak-to-trough decline in account balance.

E

Fundamental Analysis

Earnings Report

Quarterly financial results published by public companies.

E

Fundamental Analysis

EBITDA

Earnings Before Interest, Taxes, Depreciation, Amortisation.

E

Macroeconomics

ECB

European Central Bank — manages euro monetary policy.

E

Forex

ECN Account

Account type with raw spreads and commission-based pricing.

E

Forex

ECN Broker

Electronic Communication Network — connects traders directly.

E

Macroeconomics

Economic Calendar

Schedule of upcoming economic data releases and events.

E

Technical Analysis

Elliott Wave

Theory that markets move in predictable 5-3 wave patterns.

E

Technical Analysis

EMA

Exponential Moving Average — gives more weight to recent prices.

E

Psychology

Emotional Trading

Making decisions based on emotions rather than analysis.

E

Candlestick Patterns

Engulfing Pattern

Second candle body fully engulfs the first.

E

Fundamental Analysis

EPS

Earnings Per Share — net income divided by shares outstanding.

E

Forex

Equity

Account balance plus or minus unrealised P/L.

E

Indices & ETFs

ETF

Exchange-Traded Fund — basket of assets traded like a stock.

E

Crypto & Digital Assets

Ethereum

Blockchain platform supporting smart contracts and dApps.

E

Candlestick Patterns

Evening Star

Three-candle bearish reversal pattern.

E

Forex

Exchange Rate

The price of one currency expressed in terms of another.

E

Forex

Execution Speed

Time taken to process and complete a trade order.

E

Forex

Exotic Pair

A pair combining a major currency with an emerging market currency.

E

Risk Management

Expectancy

Average amount expected to win or lose per trade.

E

Trading Platform

Expert Advisor EA

Automated trading program based on predefined rules.

E

Derivatives & Options

Expiration Date

Last date an option can be exercised.

F

Technical Analysis

Fair Value Gap

Imbalance in price created by aggressive buying or selling.

F

Technical Analysis

Falling Wedge

Converging downward trendlines — typically bullish.

F

Technical Analysis

False Breakout

Price breaks a level but fails to sustain the move.

F

Psychology

Fear and Greed

Two primary emotions driving market behaviour.

F

Macroeconomics

Federal Reserve

The central bank of the United States.

F

Technical Analysis

Fibonacci Retracement

Uses Fibonacci ratios to identify support and resistance.

F

Forex

Fill

Execution of an order at the requested or best available price.

F

Order Types

Fill or Kill

Order must be executed entirely immediately or cancelled.

F

Macroeconomics

Fiscal Policy

Government spending and taxation decisions.

F

Trading Platform

FIX Protocol

Financial Information eXchange — standard messaging for trading.

F

Forex

Fixed Exchange Rate

Rate pegged to another currency or basket by government.

F

Technical Analysis

Flag Pattern

Small rectangle against the trend — continuation signal.

F

Forex

Flat Position

Having no open trades.

F

Forex

Floating Exchange Rate

Rate determined by market supply and demand.

F

Economics

FOMC

US Fed body setting interest rate policy.

F

Psychology

FOMO Fear of Missing Out

Anxiety causing impulsive trade entries.

F

Forex

Forex Market Hours

The 24-hour schedule of global forex trading sessions.

F

Crypto & Digital Assets

Fork

Change in blockchain protocol — soft fork or hard fork.

F

Forex

Forward Market

Market for agreements to exchange at a future date.

F

Forex

Forward Rate

Agreed-upon price for a future transaction.

F

Fundamental Analysis

Free Cash Flow

Cash from operations minus capital expenditures.

F

Forex

Free Margin

Available margin to open new positions.

F

Indices & ETFs

FTSE 100

UK's primary stock index — 100 largest companies.

F

Forex

Funded Trader

Trader given capital by a prop firm after passing evaluation.

F

Commodities

Futures Contract

Agreement to buy or sell at a future date and price.

G

Psychology

Gambler's Fallacy

Believing past outcomes affect future probabilities.

G

Derivatives & Options

Gamma

Rate of change of delta.

G

Forex

Gap

Price jump between the close and next open without trading.

G

Technical Analysis

Gap Fill

Price returning to cover a previous gap.

G

Technical Analysis

Gartley Pattern

Specific harmonic pattern with defined Fibonacci levels.

G

Crypto & Digital Assets

Gas Fee

Transaction fee on the Ethereum network.

G

Economics

GDP Gross Domestic Product

Total value of goods and services produced.

G

Forex

Going Long

Opening a buy position.

G

Forex

Going Short

Opening a sell position.

G

Commodities

Gold XAU

Precious metal traded as XAU/USD — major safe haven.

G

Technical Analysis

Golden Cross

50-day MA crossing above 200-day MA — bullish signal.

G

Candlestick Patterns

Gravestone Doji

Doji with long upper shadow and no lower shadow.

G

Derivatives & Options

Greeks

Risk measures for options: Delta, Gamma, Theta, Vega, Rho.

G

Stock Market

Growth Stock

Stock of a company expected to grow faster than market average.

G

Order Types

GTC Order

Good Till Cancelled — remains active until filled or cancelled.

H

Crypto & Digital Assets

Halving

Event cutting Bitcoin mining rewards in half.

H

Candlestick Patterns

Hammer

Bullish reversal candle with long lower shadow.

H

Candlestick Patterns

Hanging Man

Bearish reversal at top with long lower shadow.

H

Candlestick Patterns

Harami

Small candle within the body of the previous candle.

H

Technical Analysis

Harmonic Pattern

Patterns using Fibonacci ratios to predict reversals.

H

Crypto & Digital Assets

Hash Rate

Computational power used for mining.

H

Macroeconomics

Hawkish

Favoring higher interest rates to control inflation.

H

Technical Analysis

Head and Shoulders

Reversal pattern with three peaks, the middle being highest.

H

Portfolio Management

Hedge Fund

Private investment fund using complex strategies.

H

Risk Management

Hedging

Opening an opposing position to reduce risk.

H

Psychology

Hindsight Bias

Believing you predicted an outcome after it occurred.

H

Crypto & Digital Assets

HODL

Hold On for Dear Life — long-term holding strategy.

H

Crypto & Digital Assets

Hot Wallet

Online crypto wallet connected to the internet.

I

Technical Analysis

Ichimoku Cloud

Multi-component indicator showing support, resistance, trend, and momentum.

I

Crypto & Digital Assets

ICO

Initial Coin Offering — fundraising by selling new tokens.

I

Order Types

Immediate or Cancel

Partially fillable but unfilled portion is cancelled immediately.

I

Derivatives & Options

Implied Volatility

Market's expectation of future price volatility.

I

Derivatives & Options

In the Money

Option with intrinsic value — profitable if exercised now.

I

Indices & ETFs

Index Fund

Fund that tracks a specific market index.

I

Economics

Inflation

Rate at which general prices rise over time.

I

Forex

Interbank Market

Network of banks trading currencies with each other.

I

Economics

Interest Rate

Rate set by central bank driving currency values.

I

Derivatives & Options

Intrinsic Value

Real value of an option based on current price vs strike.

I

Forex

Introducing Broker

Partner who refers clients to a broker for commissions.

I

Technical Analysis

Inverse Head and Shoulders

Bullish reversal pattern with three troughs.

I

Candlestick Patterns

Inverted Hammer

Potential bullish reversal with long upper shadow.

I

Fundamental Analysis

IPO

Initial Public Offering — first sale of stock to the public.

I

Derivatives & Options

Iron Condor

Four-leg options strategy profiting from low volatility.

K

Risk Management

Kelly Criterion

Formula for optimal bet sizing based on edge and odds.

K

Forex

KYC

Know Your Customer — identity verification required by brokers.

L

Technical Analysis

Lagging Indicator

Indicator that follows price action (confirms trends).

L

Crypto & Digital Assets

Layer 2

Secondary framework built on top of an existing blockchain.

L

Technical Analysis

Leading Indicator

Indicator that signals future price movement.

L

Order Types

Limit Order

Buy below or sell above current price.

L

Forex

Liquidity

How easily an asset can be bought or sold without affecting price.

L

Crypto & Digital Assets

Liquidity Pool

Pool of tokens locked in a smart contract for trading.

L

Forex

Liquidity Provider

Institution supplying buy/sell quotes to brokers.

L

Technical Analysis

Liquidity Sweep

Price moves to grab stop losses before reversing.

L

Forex

Live Account

Real trading account with actual funds.

L

Forex

London Session

The most active forex trading session by volume.

L

Forex

Long Position

Buying an asset expecting its price to rise.

L

Candlestick Patterns

Long-Legged Doji

Doji with long shadows on both sides — high indecision.

L

Psychology

Loss Aversion

Tendency to feel losses more strongly than gains.

L

Forex

Lot

A standardised unit of trade size.

L

Forex

Lot Size

The number of units in a standard, mini, or micro lot.

M

Technical Analysis

MACD

Trend-following momentum indicator.

M

Forex

Major Pair

Most traded currency pairs involving USD.

M

Forex

MAM Account

Multi-Account Manager — manage multiple sub-accounts from one.

M

Forex

Margin

Deposit required to open a leveraged position.

M

Risk Management

Margin Call

Broker warning when margin level falls critically.

M

Forex

Margin Level

Equity divided by used margin, expressed as a percentage.

M

Stock Market

Margin Trading

Trading with borrowed funds from the broker.

M

Crypto & Digital Assets

Market Cap

Total value of a cryptocurrency's circulating supply.

M

Indices & ETFs

Market Capitalisation

Total value of a company's outstanding shares.

M

Indices & ETFs

Market Correction

Decline of 10% or more from recent highs.

M

Forex

Market Maker

Broker that quotes both bid and ask prices, acting as counterparty.

M

Stock Market

Market Maker Stock

Firm providing liquidity by continuously quoting buy/sell.

M

Order Types

Market Order

Buy or sell immediately at current price.

M

Stock Market

Market Order Stock

Order to buy or sell stock at current market price.

M

Fundamental Analysis

Market Sentiment

Overall attitude of investors toward a market.

M

Technical Analysis

Market Structure

Pattern of highs and lows defining trend direction.

M

Candlestick Patterns

Marubozu

Candle with no shadows — strong directional conviction.

M

Risk Management

Maximum Drawdown

Largest peak-to-trough decline in account history.

M

Trading Platform

MetaTrader 5

Industry-standard multi-asset trading platform.

M

Forex

Micro Lot

1,000 units of the base currency.

M

Forex

Mid Price

The average of the bid and ask prices.

M

Forex

Mini Lot

10,000 units of the base currency.

M

Crypto & Digital Assets

Mining

Process of validating transactions and creating new coins.

M

Forex

Minor Pair

Pairs of major currencies excluding USD.

M

Trading Platform

Mobile Trading

Trading from smartphone or tablet applications.

M

Portfolio Management

Modern Portfolio Theory

Framework for constructing optimal portfolios balancing risk and return.

M

Technical Analysis

Momentum

Rate of acceleration of price movement.

M

Macroeconomics

Monetary Policy

Central bank actions to control money supply and rates.

M

Candlestick Patterns

Morning Star

Three-candle bullish reversal pattern.

M

Technical Analysis

Moving Average

Smooths price data over a set number of periods.

M

Technical Analysis

Moving Average Crossover

Signal when short-term MA crosses long-term MA.

M

Trading Platform

MQL5

Programming language for EAs and indicators in MT5.

M

Technical Analysis

Multi-Timeframe Analysis

Analyzing charts across different timeframes for confirmation.

M

Portfolio Management

Mutual Fund

Pooled investment vehicle managed by professionals.

N

Forex

Nano Lot

100 units of the base currency.

N

Indices & ETFs

NASDAQ

US tech-heavy stock exchange and index.

N

Commodities

Natural Gas

Energy commodity traded on futures markets.

N

Forex

NDD

No Dealing Desk — broker does not intervene in pricing.

N

Technical Analysis

Neckline

Support line in head and shoulders or double bottom patterns.

N

Risk Management

Negative Balance Protection

Guarantee account cannot go below zero.

N

Fundamental Analysis

Net Income

Total profit after all expenses and taxes.

N

Forex

New York Session

The second most active forex session, overlapping with London.

N

Crypto & Digital Assets

NFT

Non-Fungible Token — unique digital asset on blockchain.

N

Indices & ETFs

Nikkei 225

Japan's primary stock index.

N

Economics

Non-Farm Payrolls NFP

US monthly jobs report.

N

Stock Market

NYSE

New York Stock Exchange — world's largest stock exchange.

O

Technical Analysis

OBV

On-Balance Volume — uses volume flow to predict price changes.

O

Order Types

OCO Order

One Cancels the Other — two linked orders where one cancels the rest.

O

Trading Platform

One-Click Trading

Execute trades with a single click without confirmation.

O

Commodities

OPEC

Organization of Petroleum Exporting Countries.

O

Forex

Open Interest

Total number of outstanding derivative contracts.

O

Technical Analysis

Order Block

Zone where institutional orders were placed.

O

Technical Analysis

Oscillator

Indicator that fluctuates between fixed boundaries.

O

Derivatives & Options

Out of the Money

Option with no intrinsic value.

O

Technical Analysis

Overbought

Asset considered priced too high and due for pullback.

O

Forex

Overnight Position

A trade held open past the end of the trading day.

O

Technical Analysis

Oversold

Asset considered priced too low and due for recovery.

O

Psychology

Overtrading

Trading too frequently or with excessive size.

P

Fundamental Analysis

P/E Ratio

Price to Earnings — stock price divided by earnings per share.

P

Commodities

Palladium

Rare precious metal used in catalytic converters.

P

Forex

PAMM Account

Percentage Allocation Money Management — pooled investment account.

P

Technical Analysis

Parabolic SAR

Stop and Reverse indicator for trailing stops and trend direction.

P

Forex

Partial Fill

Only part of an order is executed.

P

Portfolio Management

Passive Investing

Strategy tracking a market index rather than picking stocks.

P

Psychology

Patience in Trading

Waiting for high-probability setups instead of forcing trades.

P

Forex

Pegged Currency

Currency fixed to another currency's value.

P

Order Types

Pending Order

Order that executes when price reaches a level.

P

Technical Analysis

Pennant Pattern

Small symmetrical triangle after a strong move — continuation.

P

Stock Market

Penny Stock

Stock trading at a very low price, typically under $5.

P

Forex

Petrodollar

US dollars earned from crude oil exports.

P

Candlestick Patterns

Piercing Line

Bullish two-candle reversal opening below prior close.

P

Forex

Pip

The smallest standard price move in a currency pair.

P

Forex

Pip Value

The monetary value of one pip movement.

P

Forex

Pipette

One-tenth of a pip; a fractional pip.

P

Technical Analysis

Pivot Point

Technical level calculated from previous high, low, and close.

P

Commodities

Platinum

Precious and industrial metal traded on commodity markets.

P

Macroeconomics

PMI

Purchasing Managers Index — economic health indicator.

P

Portfolio Management

Portfolio

Collection of financial assets held by an investor.

P

Risk Management

Position Sizing

Determining how much capital to risk per trade.

P

Forex

Position Trading

Long-term trading based on fundamental trends.

P

Stock Market

Pre-Market

Trading session before the official market open.

P

Derivatives & Options

Premium

Price paid to buy an option contract.

P

Technical Analysis

Price Action

Trading based on raw price movement without indicators.

P

Forex

Price Feed

Live stream of current bid/ask prices from providers.

P

Fundamental Analysis

Price to Book

Stock price divided by book value per share.

P

Crypto & Digital Assets

Private Key

Secret code granting access to crypto holdings.

P

Macroeconomics

Producer Price Index

Measures average change in selling prices received by producers.

P

Risk Management

Profit Factor

Gross profit divided by gross loss.

P

Crypto & Digital Assets

Proof of Stake

Consensus mechanism based on staked cryptocurrency.

P

Crypto & Digital Assets

Proof of Work

Consensus mechanism requiring computational effort.

P

Forex

Prop Trading

Trading with a firm's capital instead of personal funds.

P

Derivatives & Options

Protective Put

Buying a put to protect a long stock position.

P

Crypto & Digital Assets

Public Key

Address used to receive cryptocurrency.

P

Technical Analysis

Pullback

Temporary reversal in price during an ongoing trend.

P

Derivatives & Options

Put Option

Right to sell an asset at a set price before expiry.

Q

Macroeconomics

Quantitative Easing

Central bank buying assets to inject money into the economy.

Q

Macroeconomics

Quantitative Tightening

Central bank reducing its balance sheet to withdraw liquidity.

Q

Forex

Quote Currency

The second currency in a pair.

R

Technical Analysis

Range-Bound

Price trading between a defined support and resistance.

R

Forex

Realised P/L

Profit or loss from closed positions.

R

Portfolio Management

Rebalancing

Adjusting portfolio weights back to target allocation.

R

Forex

Rebate

Cashback on trading costs returned to the trader.

R

Psychology

Recency Bias

Giving more weight to recent events than historical data.

R

Macroeconomics

Recession

Two consecutive quarters of negative GDP growth.

R

Risk Management

Recovery Factor

Net profit divided by maximum drawdown.

R

Technical Analysis

Relative Strength

Performance of an asset compared to a benchmark.

R

Forex

Requote

Broker offers a new price when the original becomes unavailable.

R

Forex

Reserve Currency

Currency held in large quantities by central banks.

R

Technical Analysis

Resistance Level

Price level where selling prevents further rise.

R

Macroeconomics

Retail Sales

Monthly data on consumer spending at retail stores.

R

Technical Analysis

Retracement

Temporary reversal within a larger trend, often measured by Fibonacci.

R

Forex

Revaluation

Upward adjustment of a currency's official exchange rate.

R

Psychology

Revenge Trading

Impulsive trading after a loss to recover money.

R

Fundamental Analysis

Revenue

Total income generated from business operations.

R

Technical Analysis

Reversal

Change in the direction of the prevailing trend.

R

Technical Analysis

Rising Wedge

Converging upward trendlines — typically bearish.

R

Risk Management

Process of identifying and controlling trading risks.

R

Risk Management

Risk of Ruin

Probability of losing enough capital to stop trading.

R

Risk Management

Risk Per Trade

Percentage of account risked on a single trade.

R

Risk Management

Risk Reward Ratio

Ratio of potential loss to potential gain.

R

Portfolio Management

Risk-Adjusted Return

Return metric accounting for the level of risk taken.

R

Macroeconomics

Risk-On Risk-Off

Market sentiment shifts between risk appetite and aversion.

R

Fundamental Analysis

ROA

Return on Assets — net income divided by total assets.

R

Fundamental Analysis

ROE

Return on Equity — net income divided by shareholder equity.

R

Fundamental Analysis

ROI

Return on Investment — profit relative to cost of investment.

R

Forex

Rollover

Extending a settlement date by rolling the position forward.

R

Technical Analysis

Rounding Bottom

Gradual U-shape reversal pattern.

R

Technical Analysis

RSI

Momentum oscillator on a 0-100 scale.

S

Indices & ETFs

S&P 500

Index of 500 largest US companies.

S

Forex

Safe Haven Currency

Currency that tends to retain value during market turmoil.

S

Forex

Scalping

Very short-term trading for small profits per trade.

S

Indices & ETFs

Sector Rotation

Moving investment between sectors based on economic cycle.

S

Order Types

Sell Limit

Order to sell at or above a specified price.

S

Order Types

Sell Stop

Order to sell below current market price.

S

Stock Market

Share

Unit of ownership in a company.

S

Risk Management

Sharpe Ratio

Risk-adjusted return metric — return per unit of risk.

S

Candlestick Patterns

Shooting Star

Bearish reversal candle with long upper shadow.

S

Forex

Short Position

Selling an asset expecting its price to fall.

S

Stock Market

Short Selling

Selling borrowed shares hoping to buy back at lower price.

S

Technical Analysis

Sideways Market

Market with no clear upward or downward trend.

S

Commodities

Silver XAG

Precious metal traded as XAG/USD.

S

Forex

Slippage

Difference between expected and actual execution price.

S

Technical Analysis

SMA

Simple Moving Average — arithmetic mean of closing prices.

S

Crypto & Digital Assets

Smart Contract

Self-executing contract with terms written in code.

S

Forex

Social Trading

Platform allowing traders to share and follow strategies.

S

Risk Management

Sortino Ratio

Like Sharpe but only considers downside volatility.

S

Candlestick Patterns

Spinning Top

Candle with small body and long shadows on both sides.

S

Forex

Spot Market

Market for immediate delivery of financial instruments.

S

Commodities

Spot Price

Current market price for immediate delivery.

S

Forex

Spot Rate

Current market price for immediate settlement.

S

2

Spread

The difference between the bid price and the ask price.

S

Forex

Spread Betting

Speculating on price direction without owning the asset.

S

Derivatives & Options

Spread Options

Strategy using two or more options at different strikes.

S

Crypto & Digital Assets

Stablecoin

Crypto pegged to a stable asset like USD.

S

Macroeconomics

Stagflation

High inflation combined with stagnant economic growth.

S

Crypto & Digital Assets

Staking

Locking crypto to support network and earn rewards.

S

Forex

Standard Account

Basic trading account with built-in spreads.

S

Forex

Standard Lot

100,000 units of the base currency.

S

Technical Analysis

Stochastic Oscillator

Compares closing price to price range over a period.

S

Stock Market

Stock

Share of ownership in a company.

S

Stock Market

Stock Exchange

Marketplace where stocks and securities are traded.

S

Indices & ETFs

Stock Index

Benchmark measuring performance of a group of stocks.

S

Stock Market

Stock Split

Dividing existing shares into multiple shares.

S

Order Types

Stop Limit Order

Combines stop and limit — triggers a limit order at stop price.

S

Risk Management

Stop Loss

Closes a trade automatically at a loss level.

S

Order Types

Stop Order

Buy above or sell below current price.

S

Forex

Stop Out

Automatic closing of positions when margin level falls too low.

S

Forex

STP Broker

Straight Through Processing — orders routed directly to liquidity.

S

Derivatives & Options

Straddle

Buying a call and put with same strike and expiry.

S

Derivatives & Options

Strangle

Buying a call and put with different strikes.

S

Trading Platform

Strategy Tester

Built-in MT5 tool for backtesting trading strategies.

S

Derivatives & Options

Strike Price

Price at which an option can be exercised.

S

Technical Analysis

Supply Zone

Area where selling pressure is expected to emerge.

S

Technical Analysis

Support Level

Price level where buying prevents further decline.

S

Forex

Swap

Overnight interest for holding a position.

S

Forex

Swap-Free Account

Islamic account with no overnight interest charges.

S

Forex

Swing Trading

Holding positions for days to weeks to capture price swings.

S

Technical Analysis

Symmetrical Triangle

Equal converging lines — breakout direction uncertain.

T

Risk Management

Take Profit

Closes a trade automatically at a profit level.

T

Macroeconomics

Taper

Gradual reduction of central bank asset purchases.

T

Technical Analysis

Technical Indicator

Mathematical calculation based on price, volume, or open interest.

T

Derivatives & Options

Theta

Rate of time decay in option value.

T

Candlestick Patterns

Three Black Crows

Three consecutive bearish candles signalling weakness.

T

Candlestick Patterns

Three Inside Down

Bearish reversal — harami followed by strong down candle.

T

Candlestick Patterns

Three Inside Up

Bullish reversal pattern — harami followed by strong up candle.

T

Candlestick Patterns

Three White Soldiers

Three consecutive bullish candles signalling strength.

T

Forex

Tick

The smallest possible price change in any direction.

T

Forex

Tick Value

Dollar value of one tick movement in a contract.

T

Stock Market

Ticker Symbol

Abbreviated code identifying a publicly traded stock.

T

Derivatives & Options

Time Value

Portion of option premium above intrinsic value.

T

Technical Analysis

Timeframe

The duration represented by each candlestick on a chart.

T

Crypto & Digital Assets

Token

Digital asset issued on an existing blockchain.

T

Macroeconomics

Trade Balance

Difference between exports and imports.

T

Psychology

Trading Discipline

Ability to follow your trading plan consistently.

T

Psychology

Trading Journal

Record of all trades with reasoning and emotions.

T

Psychology

Trading Plan

Written set of rules for entries, exits, and risk management.

T

Order Types

Trailing Stop

Dynamic stop loss that moves with price.

T

Order Types

Trailing Stop

Dynamic stop loss that moves with price.

T

Technical Analysis

Trend Line

Line drawn across highs or lows to define direction.

T

Technical Analysis

Trendline Break

Price crossing through an established trendline.

T

Technical Analysis

Triangle Pattern

Converging trendlines forming a triangle shape.

T

Technical Analysis

Triple Bottom

Three troughs at similar levels indicating strong support.

T

Technical Analysis

Triple Top

Three peaks at similar levels indicating strong resistance.

T

Candlestick Patterns

Tweezer Bottoms

Two candles with matching lows at support.

T

Candlestick Patterns

Tweezer Tops

Two candles with matching highs at resistance.

U

Macroeconomics

Unemployment Rate

Percentage of labour force without jobs.

U

Forex

Unrealised P/L

Profit or loss on open positions not yet closed.

U

Technical Analysis

Uptrend

Series of higher highs and higher lows.

V

Fundamental Analysis

Valuation

Process of determining the worth of an asset or company.

V

Stock Market

Value Stock

Stock trading below its intrinsic value based on fundamentals.

V

Derivatives & Options

Vega

Sensitivity of option price to volatility changes.

V

Indices & ETFs

VIX

Volatility Index — measures expected S&P 500 volatility.

V

Forex

Volatility

Degree of price fluctuation over time.

V

Risk Management

Volatility Risk

Risk from unexpected large price movements.

V

Forex

Volume

Total number of units traded in a period.

V

Technical Analysis

Volume Profile

Distribution of traded volume at specific price levels.

V

Trading Platform

VPS

Virtual Private Server — keeps EAs running 24/7.

V

Technical Analysis

VWAP

Volume Weighted Average Price — average price weighted by volume.

W

Crypto & Digital Assets

Wallet

Software or hardware storing crypto private keys.

W

Trading Platform

Web Terminal

Browser-based trading platform requiring no installation.

W

Technical Analysis

Wedge Pattern

Converging trendlines both sloping in the same direction.

W

Crypto & Digital Assets

Whale

Individual or entity holding a large amount of crypto.

W

Forex

White Label

A broker platform rebranded and offered by another entity.

W

Technical Analysis

Williams %R

Momentum indicator showing overbought/oversold levels.

W

Risk Management

Win Rate

Percentage of trades that are profitable.

W

Technical Analysis

WMA

Weighted Moving Average — assigns custom weights to each period.

W

Commodities

WTI

West Texas Intermediate — US crude oil benchmark.

Y

Macroeconomics

Yield Curve

Graph showing bond yields across maturities.

Y

Crypto & Digital Assets

Yield Farming

Earning rewards by providing liquidity to DeFi protocols.

STB Encyclopedia

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