Position Trader
- Position Traders rely on trend trading. They enter and hold positions for longer timeframes. InExchange-Traded Funds (ETFs), this might mean holding the position indefinitely.
- Swing Trader
- When swing traders enters a position, they expect to exit in a few days or maybe in a few weeks. Swing trading relies on a longer timeframe than day trading, but a shorter timeframe than trend trading.
- Day Trader
- A Day Trader does not hold positions even overnight. Day Trading attempts to profit from quick price changes.
- Exchange-Traded Funds
- (ETF) Exchange-traded funds (ETFs) are index-based derivatives, usually composed of stocks, and sometimes including commodities and bonds. An ETF is valued like a mutual fund. But, unlike a mutual fund, an ETF can be traded throughout the day as the net asset value or current trading price is continually recalculated based on trading activity.
- Derivative
- A derivative is an investment product that derives its value from another security. For example an ETF’s value is based on the value of the securities it includes.
- Bearish
- The market is bearish when price action is biased to the downside.
- Bullish
- The market is bullish when price action is biased to the upside.
- Demand
- Demand refers to the number of buyers in a specific market.
- Intraday
- Intraday trading is a type of trading in which a position is entered and exited within the same day. A trader who relies exclusively on this type of trading is day trading.
- Interday
- Interday trading is a type of trading in which a position is entered one day and held until the next day or longer.
- Range
- Range is the difference between the high and the low of a market in one day.
- Resistance
- Resistance means that some conditions are preventing price action in an area of the market from moving higher, sometimes despite significant recent market momentum. When such conditions prevail, a large supply is being sold in that area, and a large number of sellers are usually selling abruptly. The trading price may go to and through the area of resistance. If the trading price closes above the resistance area, the current bias should be bullish.
- Supply
- Supply is the number of shares or contracts in a specific market.
- Support
- Support means that an overwhelmingly high number of buyers have entered an area of the market. When such conditions prevail, many buyers are usually purchasing abruptly because thesupply of stocks in this area is low. The trading price can go to and through the area of support. However, if the trading price closes below the support area, the current bias should be bearish.
- Volatility
- Volatility is used to describe the variation of the trading price in a specific market. When the trading price varies widely, the market is described as more volatile. When the variation in the trading price is narrow, the market is described as less volatile .Volatility can be measured for the whole of the market or for a specific area of the market, plotted by a specific volume bar. The measurement of volatility can also be for a specific timeframe, such as an intraday timeframe or an interday timeframe (used in day trading).
- Scalping
- Scalping is short-term trading to take advantage of small price moves. Usually scalping is conducted on a fast chart. In Forex trading (Foreign Exchange currency trading), Forex Scalping is a common term.
- Pivot High
- Pivot High occurs over a three bar price pattern, where the centre candle has a higher high and a higher low than the two candle on either side.
- Pivot Low
- Pivot Low occurs over a three bar price pattern, where the low of the central candle is lower than the lows on either side, and the high is also lower than the highs of the two candles on either side.
- If you would like learn more about some of the terms and expressions used by traders and investors, here are links to just a few of the excellent educational sites where you should find the answer to your question.
- www.investopedia.com – A major resource covering all markets
- www.babypips.com – Specifically for forex
- www.futuresbuzz.com – Futures terms explained
- www.fxwords.com – Another site where forex terms are explained
- www.trading-glossary.com – A general glossary of trading terms
- www.cftc.gov.consumerprotection/educationcentre/cftcglossary/index.htm – All the trading terms clearly explained by the CFTC