Trading Dictionary
139+ Trading Terms Explained
Plain-English definitions for active traders - from order types and chart patterns to options Greeks and trader slang.
MACD (Moving Average Convergence Divergence) is a momentum and trend-following indicator that measures the relationship between two exponent
Margin is borrowed capital from your broker that lets you control a larger position than your cash balance would otherwise allow — a $25,000
A market order is an instruction to buy or sell immediately at the best available price — it guarantees execution but not the price, meaning
Maximum daily loss (max daily loss) is a self-imposed rule — or a broker/prop firm imposed rule — that automatically stops your trading for
Mean reversion is the trading concept that after an extreme price move away from an average (VWAP, a moving average, a prior range), price h
Momentum trading is an approach that identifies stocks moving strongly in one direction — usually driven by a catalyst, high relative volume
A moving average smooths out price data by calculating the average closing price over a set number of periods — it filters out noise and ide