The most important trading concepts explained in plain language. Every entry has a short definition, a longer explanation and a concrete market example. Useful when an AI analysis mentions a term you haven't seen before.
- RSI (Relative Strength Index)
A momentum oscillator that measures the speed and strength of price moves on a 0–100 scale.
- MACD (Moving Average Convergence Divergence)
A trend and momentum indicator that tracks the difference between two moving averages against a signal line.
- Pivot Points
Calculated daily levels derived from the previous day's high, low and close — key support and resistance markers.
- Fibonacci Retracements
Percentage-based pullback zones (23.6 %, 38.2 %, 50 %, 61.8 %, 78.6 %) within a move.
- Liquidity Zone
A price region where many stop-loss and pending orders cluster — a magnet for price.
- Stop-Loss
A pre-set order that closes a position once a defined loss is reached.
- Take-Profit
A pre-set order that closes a position once a defined profit is reached.
- Risk-Reward Ratio
The ratio of a trade's potential profit to its potential loss.
- Fair Value Gap (FVG)
A three-candle imbalance where the wicks do not overlap — price often returns later to fill it.
- Order Block
The last opposing candle before a strong move — marks the zone where institutional participants built positions.
- Trendline
A line connecting at least two consecutive lows (uptrend) or highs (downtrend).
- Support and Resistance
Horizontal price zones where price has historically reacted.
- Pip
The smallest standardised price move in a currency pair — 0.0001 for most forex pairs.
- Spread
The difference between bid and ask — the direct trading cost in market currency.
- Leverage
A mechanism that lets traders control a much larger market position with a small amount of capital.