Trading Dictionary

139+ Trading Terms Explained

Plain-English definitions for active traders - from order types and chart patterns to options Greeks and trader slang.

B
Backtesting
Performance Metrics

The process of running a defined trading strategy against historical price data to evaluate how it would have performed before risking real

Bag Holder
Trader Slang

A bag holder is a trader stuck in a losing position that has moved so far against them — usually because they refused to cut the loss — that

Bear Flag
Price Action & Patterns

A bear flag is a continuation pattern where price pauses in a tight, slightly upward channel after a sharp drop — it looks like a brief rest

Bear Market
Market Basics

A bear market is a sustained decline of 20% or more in a major stock index from recent highs — characterized by falling prices, deterioratin

Bid
Order Types & Execution

The bid is the highest price a buyer is currently willing to pay. When you sell with a market order, you receive the bid price.

Bid-Ask Spread
Order Types & Execution

The bid-ask spread is the difference between the highest price buyers will pay and the lowest price sellers will accept — it's an immediate,

Bollinger Bands
Technical Analysis

Bollinger Bands are three lines plotted around price: a middle moving average and two outer bands set at standard deviations above and below

Bracket Order
Order Types & Execution

A bracket order is a single order entry that simultaneously places three orders: your entry, a profit target above it, and a stop-loss below

Break-Even Stop
Risk & Money Management

A break-even stop is moving your stop-loss order to your exact entry price once a trade has moved sufficiently in your favor — it turns a ri

Breakout
Market Basics

A breakout is when price moves decisively beyond a defined level — a resistance zone, a consolidation boundary, a chart pattern boundary, or

Bull Flag
Price Action & Patterns

A bull flag is a continuation pattern where a stock pauses in a tight, slightly downward channel after a sharp move higher — it's called a f

Bull Market
Market Basics

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