Resources · Reference
Trading glossary
Plain-language definitions. Educational only.
- Body
- The thick part of a candle, spanning the open and close of the period.
- Breakout
- Price moving beyond a previously respected zone. Breakouts can fail.
- Bullish / bearish
- Describing upward or downward price movement. In this site, green outlines are bullish and red outlines are bearish; each is also labelled in text.
- Candlestick
- A chart mark summarising price over one time period: open, high, low and close.
- Consolidation
- A period where price moves sideways in a relatively narrow range.
- Drawdown
- The decline from a peak in account value to a subsequent low.
- Liquidity
- How easily an asset can be traded without moving its price.
- Position size
- The number of units or shares held in a trade.
- Pullback
- A temporary move against the prevailing direction.
- Resistance
- A price zone where sellers have previously stepped in.
- Reward-to-risk
- The potential gain at a target divided by the loss at the stop.
- Risk per trade
- The amount you accept losing if your stop is hit, often expressed as a percentage of your account.
- Stop loss
- A pre-planned exit that limits the loss on a position if the idea is wrong.
- Support
- A price zone where buyers have previously stepped in. A zone, not an exact line.
- Volatility
- How widely price moves over a period.
- Wick (shadow)
- The thin line above or below the body marking the period's high and low.