Trading glossary
Short definitions of terms you will see in signals, strategies and market discussions. Use it as a reference or link to specific concepts.
A
Asset
A tradable instrument such as a currency pair, stock or commodity.
B
Binary option
A derivative where the payout depends on whether the price is above or below a strike at expiry.
Bollinger Bands
A volatility indicator that plots bands around a moving average.
Break of structure
When price closes beyond the last higher low or lower high, changing the trend assumption.
C
Candlestick
A single bar on a price chart showing open, high, low and close for a period.
CCI
Commodity Channel Index, a momentum oscillator that measures deviation from the average price.
D
Divergence
A disagreement between price and an oscillator such as RSI.
E
Expiry
The time at which a short-term trade closes and the result is decided.
F
Fair value gap
An imbalance left by a fast move where almost no trading occurred.
Fixed stake
Risking the same amount on every trade regardless of recent results.
L
Liquidity sweep
A quick move beyond a recent high or low to fill stop orders before reversing.
M
MACD
Moving Average Convergence Divergence, a trend-following momentum indicator.
Martingale
A dangerous strategy that increases stake after a loss to recover quickly.
O
OTC pair
An over-the-counter instrument quoted by the broker outside regular exchange hours.
Order block
The last opposing candle before a strong impulse, often retested later.
P
Payout
The percentage return on a winning binary option trade.
R
RSI
Relative Strength Index, a momentum oscillator ranging from 0 to 100.
Resistance
A price level where selling interest has historically stopped rallies.
S
Signal
A directional trading suggestion based on technical analysis.
Smart Money Concepts
A framework that reads price through liquidity, order blocks and structure.
Spread
The difference between the bid and ask price.
Stochastic
A momentum oscillator comparing closing price to its range over time.
Strike price
The price level that determines whether a binary option wins or loses.
Support
A price level where buying interest has historically stopped declines.
T
Timeframe
The duration of each candle on a chart.
V
Volatility
The size and speed of price movements over a period.
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