Trading Dictionary
139+ Trading Terms Explained
Plain-English definitions for active traders - from order types and chart patterns to options Greeks and trader slang.
A bear market is a sustained decline of 20% or more in a major stock index from recent highs — characterized by falling prices, deterioratin
A breakout is when price moves decisively beyond a defined level — a resistance zone, a consolidation boundary, a chart pattern boundary, or
A bull market is a sustained period of rising prices in the broader market — traditionally defined as a 20% or greater rise from a recent si
A catalyst is the specific event or news item that triggers unusual price movement in a stock — earnings reports, FDA decisions, analyst upg
Consolidation is a period where price moves sideways within a relatively tight range after a directional move — it reflects a temporary equi
A false breakout occurs when price moves beyond a key level (resistance, support, a chart pattern boundary) but fails to sustain the move an
Float is the number of shares of a company that are actually available for public trading — it excludes shares held by insiders, major insti
A temporary suspension of trading in a specific stock, ordered by an exchange or regulator. Halts pause all buying and selling activity and
A higher high occurs when price makes a swing peak that is above the previous swing peak — it's one of the two defining features of an uptre
A higher low is a swing low that is above the previous swing low — paired with higher highs, it's the second component that confirms an uptr
Liquidity in trading refers to how easily you can enter and exit a position at a fair price — a liquid stock has high volume and a tight bid
A lower high is a swing high that is below the previous swing high — paired with lower lows, it's the second component that confirms a downt
A lower low is when price makes a swing low that is below the previous swing low, confirming a downtrend in market structure — the mirror im
Pre-market trading is the session that occurs between 4:00 AM and 9:30 AM Eastern, before the regular market opens — it allows traders to re
A pullback is a temporary counter-trend price movement within an established trend — in an uptrend, a pullback is a short-term decline that
A range (or trading range) is a price zone where a stock oscillates between a defined support floor and resistance ceiling without making me
Relative volume (RVOL) compares a stock's current trading volume to its average volume for the same time of day, expressed as a multiple — a
Resistance is a price level where selling pressure has historically overcome buying pressure, causing price to stall, reverse, or consolidat
A broad grouping of companies that operate in the same segment of the economy — such as Technology, Healthcare, Energy, or Financials. Stock
Short interest is the total number of a stock's shares currently sold short, expressed as a percentage of the float — it measures the collec
Support is a price level where buying pressure has historically overcome selling pressure, causing price to stop declining and reverse — it'
The CBOE Volatility Index — a real-time measure of the market's expectation for 30-day volatility in the S&P 500, derived from the prices of
Volume is the total number of shares (or contracts) traded during a given time period — it's the primary confirmation tool for all price act
