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Glossary
588 terms, defined the way a trader would use them rather than the way a marketing page would. This includes every word defined inside a lesson, so anything you meet while reading is findable here.
A
Accumulation
A long, boring range after a fall, where patient buyers build positions.
Activation price
A price a trailing stop must reach before it begins to trail.
Active addresses
How many addresses transacted. A rough usage measure, easy to inflate.
Active trading
Buying and selling over hours or weeks, with a planned exit for every trade.
Used in: Investing, DCA and trading are three different jobs
Address
Your account number on a blockchain. A long string of letters and numbers you can safely share with anyone.
Address poisoning
A scammer sends you a tiny amount from an address that looks like one of yours, hoping you copy theirs later.
Adherence
How closely you followed your own rules. The thing to optimise early on.
Admin key
A special key some projects keep that lets them change the rules, create new coins or freeze yours.
Airdrop
A free distribution of tokens to wallets meeting some criterion, usually to bootstrap users. Recipients often sell immediately, which is why an airdrop is a supply event as well as a marketing one.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
Airdrop farming
Creating many wallets to qualify for free tokens. Inflates address counts deliberately.
Airdrop scam
Free tokens appear in your wallet. Trying to sell them triggers a contract that takes everything else.
Allocation
Who got what at the start: team, investors, treasury, community.
ALT/BTC chart
A coin price divided by the Bitcoin price. Rising means the coin is beating Bitcoin; falling means it is losing to it.
Used in: BTC beta, correlation and trading altcoins in Bitcoin terms
Altcoin
Any crypto asset that is not Bitcoin. Large-cap altcoins typically move 1.5 to 3 times the size of a Bitcoin move in both directions.
AMM
Automated market maker. A pool that prices trades with a formula instead of an order book.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Anchor
The point where you start or end a drawing.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Anti-phishing code
A word you choose that the exchange puts in every real email, so a fake email is easy to spot.
API key
A code that lets an outside tool trade on your account.
Approval
Permission you give a smart contract to move your tokens. These last until you cancel them.
APY
Annual percentage yield, the return on a deposit including compounding. In crypto, a high advertised APY is usually paid in a token whose price is falling, so the real return is often negative.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Arbitrage
Buying on one venue and selling on another to capture a price difference. Arbitrageurs are the reason prices stay close across exchanges.
Arbitrageur
A trader who buys where something is cheap and sells where it is expensive, keeping prices in line across exchanges.
Arrival price
The mid price, halfway between best bid and ask, at the moment you decided to trade. The benchmark for every fill.
Used in: Measuring execution: arrival price, slippage logs, TWAP and iceberg orders
Ask
An offer to sell at a certain price. The lowest ask is the best price you can buy at right now. Also called the offer.
ATH
All-time high, the highest price an asset has ever traded at.
ATR
Average True Range, the average distance price travels per period including gaps. Used to set stop distance and position size to current volatility.
Authenticator app
A phone app that shows a new login code every thirty seconds.
Auto-deleveraging
When an exchange closes profitable positions on the opposite side because a liquidation could not be filled and the insurance fund is exhausted.
Average cost
Everything you spent, divided by all the coins you bought.
Used in: Investing, DCA and trading are three different jobs
Averaging down
Buying more of something that has fallen, hoping to lower your average price. Usually a way to enlarge a mistake.
B
Backtest
Applying your rules to past data to estimate how they would have performed.
Band
How far an allocation may drift before you rebalance. Avoids constant small trades.
Bank transfer
Sending money from your bank to an exchange. Slowest to set up, cheapest to use.
Bankruptcy claim
What a frozen deposit becomes: a right to be paid something, later, in dollars.
Used in: November 2022: FTX and why exchange risk is position risk
Basis
The gap between a futures price and the spot price. Positive basis is contango, negative is backwardation.
Basis point
One hundredth of one percent. 50 basis points is 0.5%. Traders say "bips".
Behavioural edge
Profiting from predictable crowd overreaction or underreaction.
Beta
How much something moves compared with Bitcoin. Beta of 2 means it tends to move twice as far, up and down.
Beta sizing
Giving a harder-swinging coin a smaller position, so the same dollar risk applies to each.
Used in: BTC beta, correlation and trading altcoins in Bitcoin terms
Bid
An offer to buy at a certain price. The highest bid is the best price you can sell at right now.
Bid and ask
The best price a buyer will pay (bid) and the best price a seller will accept (ask). The gap between them is the spread.
Bitcoin
The first and largest crypto asset. Fixed supply, longest history, easiest to buy and sell.
Bitcoin dominance
Bitcoin share of the whole crypto market. Rising dominance means alts as a group are losing to Bitcoin.
Used in: BTC beta, correlation and trading altcoins in Bitcoin terms
Blockchain
A shared ledger of transactions that many independent computers keep a copy of, where changes must follow rules that every participant checks.
Body
The thick part of the candle, running between the open and the close.
Bollinger Bands
A moving average with bands two standard deviations above and below. Bands narrow when volatility falls and widen when it rises.
Borrow
A loan of coins. You sell them now and must return the same number later.
Used in: Spot margin, borrowing costs and how shorting really works
Borrow rate
The interest on the loan, charged every hour you keep it.
Used in: Spot margin, borrowing costs and how shorting really works
Bracket order
A stop and a target attached to a position at entry, so the exit plan is in place from the start.
Break even
The price move you need just to get back to where you started after costs.
Break of structure
A close beyond the most recent significant swing point, marking a change in trend character.
Break-even win rate
The win rate you need, given your average win and loss, just to stand still.
Breakeven stop
Moving the stop to your entry price once the trade is in profit.
Breakout
Trading with a move, expecting the level to give way.
Used in: Support, resistance and how to draw levels properly
Breakout candle
The candle that closed above the level. Its low is where the first stop goes.
Used in: November 2024: the breakout, the round number and the retest
Burner wallet
A throwaway wallet holding a few dollars, used for anything new so your main wallet signs nothing risky.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Buy and hold
Investing with one purchase, or a few, and then leaving it alone.
Used in: Investing, DCA and trading are three different jobs
Buyback
The protocol using revenue to buy its own token.
C
Call
The right to buy. You want it if you expect the price to rise.
Used in: Options: defined risk and what you are really buying
Candlestick
A chart mark showing the open, high, low and close of one period. The body spans open to close, the wicks reach the high and the low.
Capitulation
The final stretch of heavy selling in a fall. It is a process over weeks, not a single day.
Used in: November 2022: FTX and why exchange risk is position risk
Card purchase
Buying crypto with a debit or credit card. Instant, and the most expensive way.
Carry
The running cost of holding a trade: borrow interest on spot margin, funding on a perpetual.
Used in: Spot margin, borrowing costs and how shorting really works
Carry cost
The ongoing cost of holding a hedge: funding, premium, or given-up upside.
Carry trade
Borrowing in a currency with low interest, such as yen, to buy assets elsewhere that pay more.
Cascade
Forced selling that triggers more forced selling, each wave pushing price into the next.
Cash and carry
Buying spot and shorting the perpetual against it, to collect funding with little price risk.
Cash is a position
Holding stablecoins is an active decision with its own return and risk, not a failure to act.
CEX
Centralised exchange. A company holds your coins and matches orders, which is what the simulator models.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Chandelier stop
A trailing stop set a number of ATRs below the highest close since entry.
Channel
Two parallel trendlines, one over the highs and one under the lows.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Chart pattern
A recognisable shape in price. Only useful when you can explain who is trapped by it.
Used in: Fibonacci, chart patterns and what survives testing
Chasing
Entering above your planned zone because you are afraid of missing out. The most common unforced error.
Circuit breaker
A rule on stock exchanges that pauses trading after a big move. Crypto has none.
Circulating supply
The number of tokens currently in public hands, as opposed to total supply, which includes tokens not yet issued.
Cliff
A single date when a large tranche unlocks at once. The event to check for.
Close
The price at the end of the period. The most important of the four.
Closed trade
A trade that has been sold, so its result is final.
Cold storage
Keeping private keys on a device that has never been connected to the internet, or on a hardware wallet.
Collar
Buying a put and selling a call, so downside and upside are both capped.
Collateral
What you deposit so the exchange will lend to you.
Used in: Spot margin, borrowing costs and how shorting really works
Commission
The fee the exchange charges you, shown on the confirmation screen.
Compounding
Returns building on returns. Slow, then suddenly not slow.
Compression
A period where price moves less and less in a tightening range. It usually ends in a large move.
Concentration
Having one big bet, whether or not it looks like several small ones.
Confirmation
Each new page added after your transaction. More confirmations mean it is harder to undo.
Confirmation bias
Seeking out opinions that agree with your position and dismissing the rest.
Confluence
Several independent reasons pointing at the same price. Three momentum indicators agreeing is not confluence; structure, level and volume agreeing is.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Consensus
What the market expects a number to be. A surprise is the gap between the print and consensus.
Consistency
Repeating the same process. It compounds, where brilliance does not.
Constant product
The common AMM rule: the two token amounts multiplied together must stay equal after every trade.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Contango
Futures trading above spot. Usual in a bullish market.
Context chart
The slowest of your three charts. It decides which direction you are allowed to trade.
Cooldown
A forced pause after losses, so the next decision is not made in the same state.
Copycat
A token launched to capture attention from a working narrative. Usually the worst thing to hold.
Core
Long-term holdings, mostly BTC and ETH, bought on a schedule and not traded.
Correlation
How reliably two coins move together, from minus 1 to plus 1. High correlation means they rise and fall on the same days.
Used in: BTC beta, correlation and trading altcoins in Bitcoin terms
Correlation matrix
A grid showing how much each pair of holdings moves together.
Cost basis
What you originally paid for something. Needed to work out profit or loss.
Counter-trend
A trade against the bigger picture. Sometimes valid, always needs smaller size.
Counterparty
The other side you depend on to pay you. Here, the exchange holding your money.
Counterparty risk
The risk that the venue holding your hedge fails. Both legs in one place means one failure takes both.
Covered call
Selling a call against coins you own, for income, giving up upside above the strike.
Used in: Options: defined risk and what you are really buying
CPI
The US consumer price index, the headline monthly inflation number. A hot print usually pressures risk assets.
Cross margin
A margin mode where the entire account balance backs every position. Reduces the chance of any single liquidation and raises the maximum possible loss to everything.
Curve fitting
Adjusting settings until past signals look good. It almost never survives into the future.
Custody
Who controls the private keys. Self-custody means you hold them; an exchange balance means somebody else does.
Custody split
Deciding what sits in self-custody and what sits on an exchange.
Cycle
The multi-year pattern of expansion and contraction in crypto.
D
Daily loss limit
A rule that stops you trading for the day after a set loss. Fires before revenge trading can.
Dead cat bounce
A sharp but short-lived rally inside a downtrend, which fails at a lower high.
Death cross
The reverse. A faster average crossing below a slower one.
Deep repetition
Running one method many times, which is how rules become skill.
Deepfake
A fake video or voice of a real person, made by a computer.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
DeFi
Decentralised finance: lending, trading and derivatives run by smart contracts rather than by a company.
Deleveraging
Borrowed money leaving the market, whether by choice or by force.
Delta
For options, the sensitivity of the option price to a $1 move in the underlying. Loosely, an approximate probability of finishing in the money.
Used in: Options: defined risk and what you are really buying
Delta hedging
Shorting a derivative against spot you own, to cut price exposure without selling.
Deposit
Moving money or coins onto an exchange so you can trade with it.
Depth
How much money is waiting near the current price. Deep means you can trade big without moving it.
Derivative
Something whose value comes from another asset. You are trading a bet about bitcoin, not bitcoin.
Derivatives volume
Trading of contracts based on the coin. Can be much larger than spot, and means something different.
DEX
Decentralised exchange. You swap tokens directly from your wallet, with no account and no custodian.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Dilution
New coins arriving, so each existing coin owns a smaller share.
Discretion
Judgement left to you in the moment. Every piece of it is a place the rules can be rewritten.
Disposal
Getting rid of an asset. In many countries swapping one coin for another counts, even though no cash was involved.
Distribution
New highs with weakening strength, while patient holders sell into the excitement.
Divergence
Price making a new extreme while an oscillator does not. It marks decelerating momentum, and can persist for a long time before anything happens.
Diversification
Spreading risk across things that do NOT move together. Five altcoins is not diversification.
Doji
A candle that opened and closed at almost the same price. Shows indecision.
Dollar-cost averaging
Buying the same money amount on the same day each month, whatever the price. Often shortened to DCA.
Used in: Investing, DCA and trading are three different jobs
Dominance
The share of total crypto market capitalisation held by one asset, most often Bitcoin. Rising dominance in a falling market signals flight to safety.
Double top
Two failed attempts at the same high. The second failure traps the people who chased.
Used in: Fibonacci, chart patterns and what survives testing
Downtrend
Each peak is lower than the last, and each dip is lower than the last.
Drainer
A malicious contract that empties your wallet once you approve it.
Drawdown
The fall from a peak in account value to the following trough. A 50% drawdown requires a 100% gain to recover.
Used in: Investing, DCA and trading are three different jobs
Dust
A tiny amount of a coin sent to your wallet to track you.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
DYOR
Do your own research. Frequently used as a disclaimer by people who have not done any.
E
Edge
Making money on average, after all costs, over many trades.
Used in: Investing, DCA and trading are three different jobs
Edge decay
An edge weakening as more people find it and more money crowds into it.
Efficient market
The idea that prices already reflect known information, so easy profits are competed away.
EMA
Exponential moving average, which weights recent prices more heavily than older ones, so it turns faster than a simple moving average.
Emissions
The rate new coins are created and released.
Entry
The price where you get into the trade.
Used in: From chart to trade: planning a trade in the simulator
Entry zone
The price band where you are willing to enter. Outside it, there is no trade.
Equity
Your total account value: cash plus the current value of what you hold.
Equity curve
A chart of the account balance over the test. A real one is uneven.
Escrow
A neutral third party holding the money until both sides complete. What makes peer to peer safe enough to use.
ETF flows
Daily money into or out of the US spot bitcoin funds. A streak matters; a single day rarely does.
Exchange
A marketplace that matches buyers with sellers and holds your balance while you trade there.
Exchange net flow
Coins moving onto or off exchanges. Inflow is potential selling; outflow is potential removal from sale.
Exchange token
A coin issued by an exchange itself, such as FTT. It rises and falls with trust in that exchange.
Used in: November 2022: FTX and why exchange risk is position risk
Execution
How well you actually got into and out of a trade, separate from whether the idea was right.
Used in: Measuring execution: arrival price, slippage logs, TWAP and iceberg orders
Exit liquidity
What you become when you buy something so that somebody earlier can sell it to you.
Expectancy
What one average trade returns, in R. Win rate times average win, minus loss rate times average loss.
Expiry
The date the right runs out. After it, the option is worth nothing.
Used in: Options: defined risk and what you are really buying
Extension
How far price has stretched away from its average. A long way means mean reversion risk.
F
Fade
Trading against a move, expecting the level to hold.
Used in: Support, resistance and how to draw levels properly
Fake platform
A website or app that looks like an exchange but only shows numbers the scammer types in.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
False break
Price closes beyond a level then comes straight back inside. The break did not hold.
Used in: Support, resistance and how to draw levels properly
Falsifiable
Able to be proved wrong by a specific price. If nothing can disprove a claim, it cannot be traded.
Used in: Fibonacci, chart patterns and what survives testing
FDV
Fully diluted valuation: price multiplied by total eventual supply. A large gap between market cap and FDV means heavy dilution is still to come.
Fear and Greed index
A sentiment gauge from 0 to 100 built from volatility, momentum, volume and social data. Useful at extremes, noise in the middle.
Fee
The small charge taken on every fill. In the simulator it is 0.1% of the trade value.
Fee drag
The slow loss caused by paying a fee on every purchase and sale.
Used in: Investing, DCA and trading are three different jobs
Fee revenue
What users actually paid to use a network. The closest thing to real revenue.
Fee tier
Exchanges charge less if you trade more. Most beginners sit on the highest fee.
Fibonacci
A tool that marks common pullback depths, such as half or 61.8% of a move.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Fibonacci retracement
Levels at 38.2%, 50% and 61.8% of a prior move. They work partly because many traders draw the same lines from the same swings.
Used in: Fibonacci, chart patterns and what survives testing
Filter
A rule that decides whether you may trade at all. What moving averages are genuinely good for.
Fixed target
Exiting the whole position at a price decided in advance.
Flag
A brief sideways pause after a sharp move, usually continuing in the same direction.
Used in: Fibonacci, chart patterns and what survives testing
Flip
When broken resistance starts acting as support, or the reverse.
Used in: Support, resistance and how to draw levels properly
Float
The share of supply actually tradable now. A small float makes the price easy to move.
FOMC
The US Federal Reserve meeting that sets interest rates. Eight times a year, with a decision and a press conference.
FOMO
Fear of missing out. What makes people buy a vertical candle.
Forced flow
Buying or selling that happens because a rule fired, not because anyone chose it.
Forced seller
Someone who must sell regardless of price, for example a bankruptcy estate.
Used in: November 2022: FTX and why exchange risk is position risk
Forward test
Running the rules on data the method has never seen, or live in a simulator. The only honest estimate.
Four-way grid
Won or lost, crossed with followed or broke the plan. Four boxes, very different meanings.
Fragility
How badly a market would react if it moved. High when one side is crowded and borrowed.
Fragmented liquidity
The same coin trading on dozens of exchanges, so the queue at any one of them is thinner than the total.
Friction
All your trading costs added together. The hurdle a trade must clear to break even.
Front running
Trading ahead of an order you know is coming, to profit from the move it will cause.
Funding rate
A periodic payment between longs and shorts on a perpetual swap, which pulls the contract price back toward spot. Positive funding means longs pay.
Futures contract
An agreement to exchange an asset at a set price on a set date.
G
Gamma
How fast delta changes. Why near-the-money options move violently close to expiry.
Used in: Options: defined risk and what you are really buying
Gap
Price jumping past your stop without trading at it, so you exit worse than planned.
Gas
The fee paid to a network to process a transaction. Rises with congestion and can exceed the value being sent on small transfers.
Golden cross
When a shorter moving average crosses above a longer one, commonly the 50 above the 200. A heavily lagging signal.
Governance
Voting rights. Weak value capture on its own.
Green candle
One that closed higher than it opened. Sometimes drawn white or hollow.
GTC / IOC / FOK
Time-in-force: good till cancelled, immediate or cancel, and fill or kill. How long an order is allowed to live.
H
H-line
A horizontal line at one exact price. Used for a stop or a target.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Halving
The roughly four-yearly cut in new bitcoin supply. Known years ahead and usually already priced.
Hard fork
A protocol change that is not backwards compatible, sometimes splitting a chain into two.
Hard limit
A limit enforced by something other than willpower. Logging out counts.
Hard to borrow
When so many people want to borrow a coin that few are left to lend, and the rate jumps.
Used in: Spot margin, borrowing costs and how shorting really works
Hardware wallet
A small dedicated device that signs transactions without ever revealing your key to your computer.
Hash rate
The total computing power securing a proof-of-work network.
Head and shoulders
A failed higher high with an obvious neckline. Really just a structure break with a name.
Used in: Fibonacci, chart patterns and what survives testing
Heat
Total risk currently live across every open position: what you lose if all stops are hit at once.
Hedge
A position taken to reduce the risk of another position, rather than to make money by itself.
Hedge ratio
What proportion of the position you hedge. Half means you keep half the exposure.
High
The highest price reached during the period.
High volume node
A price where a lot was traded. Price moves through it slowly and is drawn back to it.
Higher low
A swing low above the previous one. The first sign that selling is exhausted.
Used in: November 2022: FTX and why exchange risk is position risk
Higher timeframe
A chart where each candle covers more time. It shows the bigger picture.
Hindsight bias
Remembering the chart as clearer than it was, once you know the outcome.
Histogram
Bars showing the gap between the MACD line and its signal line. Shrinking bars mean momentum fading.
Honeypot
A token you can buy but cannot sell.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
Hot wallet
A wallet whose keys are on an internet-connected device. Convenient, and the target of most thefts.
I
Iceberg
A large order that shows only a small slice on the book at a time, hiding your true size.
Used in: Measuring execution: arrival price, slippage logs, TWAP and iceberg orders
Iceberg order
An order that shows only a slice of its true size in the book, to hide a large trade. A concept for a real venue; not on this simulator.
Impermanent loss
The loss a liquidity provider takes relative to simply holding, caused by the pool rebalancing as prices move.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Impersonation
Someone posing as support, a founder, or a friend. Real support never messages you first.
Implied volatility
How much movement the market is pricing in. Higher means more expensive options.
Used in: Options: defined risk and what you are really buying
In the money
The option would be worth exercising right now.
Used in: Options: defined risk and what you are really buying
Incentive emissions
Yield paid in a token the protocol prints. Often the very thing being sold into your deposit.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Incentivised liquidity
Trading depth that exists only because the protocol pays for it. Remove the payment and the book empties.
Independent
Measuring genuinely different things. RSI and Stochastic both measure speed, so they are not independent.
Index rebalance
A fund being obliged to buy or sell to match an index. Predictable, and not trying to beat you.
Infrastructure
The practical setup: two exchanges, hardware wallet, alerts, backups, records.
Insider allocation
The share held by the team and early investors. A scheduled supply event.
Institution
A fund, bank or company trading large amounts, usually with rules it must follow.
Insurance fund
Money an exchange sets aside to cover leveraged trades that lose more than the trader put in.
Invalidation
The price that proves your idea was wrong.
Used in: From chart to trade: planning a trade in the simulator
Inventory
How much of an asset a market maker is holding. They adjust their prices to get back to holding nothing.
Inverse contract
Margin and profit in the coin itself. Non-linear, and your collateral moves with the position. Avoid at first.
Investing
Buying something to keep for years because you believe it will be worth more later.
Used in: Investing, DCA and trading are three different jobs
Isolated margin
A margin mode where only the margin assigned to a position can be lost. The correct default while learning.
J
Journal
Your written record of each trade: why you took it and what happened.
Used in: From chart to trade: planning a trade in the simulator
K
Kelly criterion
A formula for the bet size that grows an account fastest, if you know your edge exactly. In practice it is far too big.
Keltner channel
Like Bollinger Bands but built from ATR instead of standard deviation.
KYC
Know your customer: the identity verification exchanges are required to perform. Raising withdrawal limits usually requires it, and it takes time.
L
Laggard
A coin underperforming Bitcoin. Usually cheap for a reason, and not a buy however tempting.
Used in: BTC beta, correlation and trading altcoins in Bitcoin terms
Lagging
Reacting after the event. Every moving average is lagging by design, because it averages the past.
Large cap
A coin worth many billions. Easier to buy and sell without moving the price.
Last price
The most recent trade on this exchange. Not what liquidation uses.
Layer 1
A base blockchain such as Bitcoin, Ethereum or Solana, which settles its own transactions.
Layer 2
A network that processes transactions off a base chain and settles back to it, to raise throughput and cut fees.
Leader
A coin in the top group of your list against Bitcoin. In a bull market these are the candidates.
Used in: BTC beta, correlation and trading altcoins in Bitcoin terms
Leak
A specific repeated mistake that costs you money. The thing a review is for.
Leverage
Controlling a position larger than your margin. It multiplies gains and losses and introduces forced closure by liquidation.
Liabilities
What a company owes. For an exchange, that is mostly its customers' deposits.
Limit order
An order to trade at a specified price or better. It rests in the book, may not fill, and usually pays a lower fee.
Linear contract
Margin and profit in a stablecoin. Simple arithmetic. The correct default.
Liquidation
Forced closure of a leveraged position when losses have consumed the margin. The exchange closes it at market, which is why cascades develop.
Liquidation cascade
Forced closures pushing price into more forced closures.
Liquidation cluster
A price where many liquidation levels sit together, because people pick the same round leverage.
Liquidation heatmap
An estimate of where liquidation levels cluster. A map of where forced orders sit.
Liquidation price
The price at which the exchange force-closes a leveraged position because the margin is used up.
Liquidity
How much can be traded without moving the price. The practical test is what it costs to exit your size in one click during a panic.
Long
A position that profits when price rises.
Long squeeze
The same thing downward: falling price forcing longs to sell.
Long-short ratio
The proportion of accounts positioned long against short. Counts accounts, not money.
Long-term holder
A wallet that has not moved its coins for months. When these start selling, late cycle is usually near.
Lookahead bias
Using information that was not available at the moment of the decision.
Losing streak
Several losses in a row. Normal, expected, and what your sizing must survive.
Loss aversion
Losses hurting about twice as much as equal gains feel good. Why people cut winners early and hold losers.
Low float
A coin with few coins actually available to trade, so its price is easy to push.
Used in: Spot margin, borrowing costs and how shorting really works
Low volume node
A price where little was traded. Price travels through it quickly.
Lower low
A swing low below the previous one. On a daily chart it signals the uptrend is broken.
Lower timeframe
A chart where each candle covers less time. More detail, more noise.
Lump sum
Putting all the money in at once.
Used in: Investing, DCA and trading are three different jobs
M
MACD
The difference between two exponential moving averages, plotted with a signal line and a histogram. Good for seeing momentum fade, poor for entries in a range.
Macro
The big economic backdrop: interest rates, inflation, and how much money is flowing through the system.
Macro correlation
Crypto moving with global stocks and against safe-haven currencies, especially in a panic.
Magnet
An obvious level price is drawn toward. Take partial profit into it rather than buying at it.
Used in: November 2024: the breakout, the round number and the retest
Maintenance margin
A small buffer the exchange keeps back, so liquidation happens just before the margin is fully gone.
Maker
A trader whose resting limit order adds liquidity to the book. Makers pay lower fees than takers.
Mandate
The rules a fund must follow. It may be forced to hold or sell regardless of what it thinks.
Margin call
A warning that your collateral is running low against your loan.
Used in: Spot margin, borrowing costs and how shorting really works
Mark price
A price derived from an index of several venues, used to calculate liquidation, so a single manipulated wick cannot liquidate everybody.
Market cap
Price multiplied by circulating supply. The correct way to compare the size of two assets. Price per coin alone means nothing.
Market maker
A firm that quotes both a buy and a sell price all day and earns the spread. It does not care which way price goes.
Market neutral
Arranged so the overall price direction barely matters.
Market order
An order to trade immediately at whatever price the book offers. Fast, and it pays the spread plus any slippage.
Markup
The lines and bands you draw on a chart to mark the prices you care about.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Maximum drawdown
The worst peak-to-trough fall during the test.
Mean reversion
The tendency of price to come back toward its average after stretching away from it.
Mechanical selling
Selling that happens because a rule fired, not because anybody decided the asset was worth less.
Mechanism
The reason a pattern works: which group of traders is forced to act, and why.
Used in: Fibonacci, chart patterns and what survives testing
Mempool
The queue of broadcast transactions waiting to be included in a block.
Mental stop
Intending to exit at a price without placing the order. Under stress it becomes hope.
MEV
Value extracted from the order in which transactions are processed, at your expense.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Miner
A computer that competes to add the next page to the notebook, and is paid in new coins for doing it.
Minimum sample
The number of trades you must take before you are allowed to change anything.
Module exam
A timed test that opens when you finish every lesson in a module. The pass mark is 75%.
Momentum
How fast and how consistently price is moving. Not the same as how high it is.
Monte Carlo
Shuffling the same trades into many random orders to see how different the journey could have been.
Moving average
A line showing the average price over the last N periods. Smooths out the noise.
MVRV
Market value to realised value: the ratio of market cap to the aggregate price at which coins last moved. Historic extremes have marked cycle turns.
N
Naked selling
Selling an option you are not covered for. Theoretically unlimited loss. Not for beginners.
Used in: Options: defined risk and what you are really buying
Narrative
A story explaining why a group of coins should rise. Real money follows stories, for a while.
Neckline
The level whose break confirms a head and shoulders.
Used in: Fibonacci, chart patterns and what survives testing
Net exposure
What you are really long or short after everything is netted off.
Net worth
Everything you own. The base that total crypto exposure should be a share of.
Network
The blockchain a token is sent on, such as Tron (TRC-20) or Ethereum (ERC-20). The sending and receiving network must match exactly.
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
Node
A computer that keeps a full copy of the blockchain and checks that new transactions follow the rules.
Noise
Random movement that carries no information. There is more of it on faster charts.
Non-farm payrolls
The monthly US jobs report. The market reads it for the rate path, not the economy, so reactions can surprise.
Notional
The full dollar value of the position.
Used in: From chart to trade: planning a trade in the simulator
O
OCO (one cancels the other)
A Stop and a Target placed together. When one fills, the other is cancelled automatically. The simulator supports this.
Off switch
The written condition that tells a strategy to stop trading because its kind of market has gone.
Off-ramp
Any way of turning crypto back into ordinary money in your bank.
Official rate
The dollar rate the banks publish. Slow to move, and hard for a retail trader to actually buy at.
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
Old high
A previous peak that acts as resistance until price closes above it and holds.
Used in: January 2024: buy the rumour, sell the news, then a new high
On-chain
Data taken directly from the blockchain rather than from an exchange.
On-ramp
Any way of turning ordinary money into crypto.
Open interest
The total notional value of derivative contracts currently open. Read together with price, it shows whether leverage is building or unwinding.
Operating model
The whole system around your trading: rules, records, limits, routine and review.
Option
The right, but not the obligation, to buy or sell at a set price before a set date.
Used in: Options: defined risk and what you are really buying
Options expiry
The date option contracts settle. Price often drifts toward heavy strikes into it, then moves freely after.
Order book
The two queues of resting buy and sell orders on an exchange. It determines what your order actually costs.
Order ticket
The small form where you set up an order before you send it.
Oscillator
An indicator that moves within a fixed range, usually 0 to 100. Measures speed, not value.
Out of sample
Data the method has never seen. The only honest test.
Outcome
Whether the trade made or lost money. Mostly luck over a small sample.
Over-filtering
Adding so many conditions that you get too few trades to ever evaluate.
Over-hedging
Hedging more than you hold, which turns a hedge into an accidental directional bet.
Overbought
A high RSI reading. It means moving up fast, NOT too expensive. This word misleads more beginners than any other.
Overfitting
Tuning settings until past results look perfect. It describes one history, not a behaviour.
Oversold
A low RSI reading. Means falling fast, not cheap.
Overtrading
Taking more trades than your method calls for. Usually boredom wearing a suit.
P
P2P
Buying or selling crypto directly with another person, with the exchange holding the coins until both sides are done.
Parallel rate
The street or bureau rate you really pay for dollars. Often close to double the official rate.
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
Partial
Selling a fraction of a position at a set profit.
Partial profit
Selling part of a position while keeping the rest, often before a risky event.
Used in: January 2024: buy the rumour, sell the news, then a new high
Participation
How many people took part in a move. High volume means many, low volume means few.
Password manager
An app that creates and stores a different long password for every site.
Payoff ratio
Your average win divided by your average loss.
PCE
The Fed's preferred inflation gauge. Usually a smaller reaction than CPI, which comes out first.
Peer to peer
Buying from another person, with the exchange holding the funds until both sides are happy.
Peer to peer (P2P)
Buying or selling crypto directly with another person, with the exchange holding the coins in escrow until both sides are happy.
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
Peg
The one-dollar value a stablecoin is meant to hold. When it slips below, the coin has "lost its peg".
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
Percentile
A place in a sorted list. The 5th percentile is the value that only 5 results in 100 are worse than.
Period
How many candles the average covers. A 50 period average on a daily chart covers 50 days.
Perpetual swap
A futures contract with no expiry, kept near spot by the funding rate. The dominant leveraged instrument in crypto.
Phishing
A fake website or message that looks real, built to collect your password or seed phrase.
Pig-butchering
A slow scam. The victim is won over with friendship and fake profits, then pushed to deposit a large sum that is stolen.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
Planned R
The R multiple you were aiming for when you entered.
Ponzi scheme
A scheme that pays earlier members with money from newer members, until new money stops.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
Portfolio construction
Designing the whole book first, then filling it, rather than accumulating positions.
Position size
How much of the coin you buy.
Used in: From chart to trade: planning a trade in the simulator
Position value
Size multiplied by price. How much money is deployed. Also an output, not an input.
Positioning
Where the crowd is placed. Tells you what happens IF price moves, not when.
Post-only
An instruction that rests as a maker and is rejected if it would take liquidity, to guarantee the lower fee.
Post-session
The ten minutes of recording afterwards. The part people skip, and the part that compounds.
Practice cash
The pretend dollars in your simulator. Every new account starts with $100.
Pre-mortem
Writing down the bear case before you enter, so you have already considered being wrong.
Pre-session
The fifteen minutes of preparation before you are allowed to trade.
Priced against BTC
Measuring a coin's performance in bitcoin rather than dollars. The honest comparison.
Priced in
When an expected event is already reflected in the price, so its arrival moves little or reverses.
Used in: January 2024: buy the rumour, sell the news, then a new high
Private key
The secret that authorises spending from an address. Whoever has it controls the funds. It can never be recovered if lost.
Process
How you made the decision. The thing to grade, because outcome over a few trades is mostly luck.
Process grade
A mark for how well you followed your rules, given independently of profit.
Profit factor
Gross profit divided by gross loss. Above 1.3 after costs is respectable; above 2.0 on a large sample usually means a methodology error.
Proof of reserves
A published report of what an exchange holds. It only helps if it also shows what the exchange owes.
Proof of stake
A consensus method where validators are chosen by the size of their staked collateral, which can be destroyed if they cheat.
Proof of work
A consensus method where miners spend electricity solving a puzzle for the right to add a block.
Protective put
Buying a put against coins you own. Insurance with a known cost.
Used in: Options: defined risk and what you are really buying
Public key
Derived from your private key. Your address comes from it. Safe to share.
Pullback
A temporary move against the trend, which then continues. A pause, not a turn.
Pump and dump
A group buys a small coin quietly, promotes it loudly, then sells into the people who arrive.
Put
The right to sell. You want it if you expect the price to fall, or as insurance.
Used in: Options: defined risk and what you are really buying
Pyramiding
Adding to a trade that is already in profit, in smaller and smaller pieces.
Q
Quarantine list
Where a coin you first heard about from a promotion waits two weeks before it can be considered.
Quarterly review
The only time you are allowed to change the strategy, and then by one thing.
R
R
One unit of risk. A trade that makes twice what it risked made 2R.
Used in: From chart to trade: planning a trade in the simulator
R multiple
A trade result expressed as a multiple of the amount risked. Losing the planned amount is -1R, making three times it is +3R.
Range
Neither of the above. Price moves sideways between a floor and a ceiling. Most of the time.
Range breakout
Price leaving a sideways band it has respected for a while.
Used in: Fibonacci, chart patterns and what survives testing
Ray
A trendline that carries on to the right edge of the chart.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Readiness gate
A test you can check with a number, which you must pass before the next step.
Realised cap
The total value of all coins priced at whatever they last moved for.
Realised volatility
The standard deviation of returns over a period, usually annualised. Bitcoin typically sits between 40% and 80%.
Rebalancing
Returning a portfolio to its target allocations on a schedule. It trims strength and adds to weakness without requiring a forecast.
Recall
The lender asking for the coins back. You must buy them at once, at any price.
Used in: Spot margin, borrowing costs and how shorting really works
Recency bias
Giving too much weight to what just happened. Why people size up after three wins.
Recovery scam
A second scam aimed at someone already robbed, promising to get the money back for a fee.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
Red candle
One that closed lower than it opened. Sometimes drawn black or filled.
Reduce-only
An order that can only shrink or close a position, never open one in the opposite direction. A derivatives-venue safeguard.
Regime
Whether the market is trending up, trending down, or ranging.
Regime filter
The condition that must be true before you may trade at all.
Regime fit
Whether a method suits the current market condition. Most methods do not stop working; they stop matching.
Regulator
A government body that licenses and watches financial companies.
Rejection
Price reached a level and was pushed back before the period ended. Shows as a long wick.
Relative strength
How a coin performs against Bitcoin rather than against the dollar. The performance that decides if an alt earns its risk.
Used in: BTC beta, correlation and trading altcoins in Bitcoin terms
Reproducible
Two people reading the rules would act identically. The completeness test.
Reserve
Stablecoins and cash, untouched by trading. Funds opportunities and life.
Resistance
A price area where sellers have stepped in before, so price tends to stop rising there.
Used in: Support, resistance and how to draw levels properly
Retail trader
An individual trading their own money. You, and almost everyone you see online.
Retest
Price returning to a level it just broke through. Often the best entry available.
Used in: Support, resistance and how to draw levels properly
Retirement rule
The condition, decided in advance, that makes you stop trading a method.
Retracement
The part of a move that price gives back before it carries on.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Revenge trading
Trading immediately after a loss to win it back. The single most expensive emotional state.
Reversal
A move against the trend that does not recover. The trend has actually changed.
Review loop
Scheduled reviews: weekly on process, monthly on expectancy, quarterly on the strategy.
Review queue
The questions you got wrong, saved and brought back later until you know them.
Reward to risk
How far the target is from the entry, divided by how far the stop is.
Used in: From chart to trade: planning a trade in the simulator
Risk
The money you lose if the stop is hit.
Used in: From chart to trade: planning a trade in the simulator
Risk amount
The money you lose if the stop is hit. You choose this, as a small percentage of the account.
Risk curve
Ordering assets from safest to most speculative. Money moves along it in both directions.
Risk of ruin
The chance that a losing run takes the account down to the point where you stop.
Risk off
Money moving back toward bitcoin and cash.
Risk on
Money moving toward the speculative end.
Risk per unit
The distance between entry and stop, per coin. The denominator of the formula.
Risk unit
Another name for R. The fixed amount you are willing to lose on one trade.
Rotation
Money moving from one part of the market to the next in a repeating order.
Round number
Prices like $100,000 that attract attention and orders simply because they are memorable.
Used in: Support, resistance and how to draw levels properly
Round trip
One complete trade: getting in and getting out. All costs are paid twice.
Round-trip cost
The total premium and fees paid to buy a stablecoin and later sell it back, before any trading.
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
Routine
A fixed sequence before, during and after the session. It removes decisions.
RSI
Relative Strength Index, a momentum oscillator from 0 to 100. High readings mean fast movement, not that a price is too expensive.
Rug pull
A project whose team removes liquidity or dumps its holdings, leaving holders unable to sell at any meaningful price.
Runner
The part of a position you keep open after taking a partial.
S
Sample size
How many trades you are judging from. Below 30 the numbers are noise.
Sandwich attack
A bot buying in front of your transaction, letting your order push the price, then selling into you. Enabled by a wide slippage tolerance.
Sandwich bot
A bot that trades just before and after your swap to profit from the slippage tolerance you allowed.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Saturation
When everybody who could be convinced by a story already has been. The story stops working.
Scaling in
Entering a trade in several planned pieces across a price zone, with one shared stop.
Scaling out
Taking part of the profit at one level and letting the rest run.
Scaling up
Increasing risk per trade. Should follow evidence across a sample, never a good run.
Screen
A quick, repeatable check that narrows many markets down to the few worth studying.
Second factor
A second proof at login, such as a code from an app, on top of your password.
Sector
A themed group of coins, such as gaming or AI, that tends to move together.
Seed phrase
Twelve or twenty-four words that regenerate every key in a wallet. Anyone who reads it owns the funds. It is never typed into a website.
Self custody
Holding your own keys. Complete control, and complete responsibility.
Self-custody
Holding coins in a wallet whose private keys you control, so no exchange can freeze them.
Used in: November 2022: FTX and why exchange risk is position risk
Self-transfer
Moving coins between two wallets you both own. Usually not taxable, but must still be recorded.
Sell the news
A fall after good news, because the people who bought early take profit on the announcement.
Used in: January 2024: buy the rumour, sell the news, then a new high
Separate income
Earning your living from something other than trading. It makes correct sizing possible.
Sequence risk
The danger that comes from the order of your results, not from the results themselves.
Setup
The observable state that must exist before you look for an entry.
Setup chart
The middle chart. It shows the level and the structure you are trading.
Setup name
A short label for the kind of trade, so you can compare setups against each other.
Short
A position that profits when price falls.
Used in: Spot margin, borrowing costs and how shorting really works
Short covering
Shorts buying back to close. Pushes price up while open interest falls.
Short squeeze
Rising price forcing shorts to buy, pushing price up further.
Signal line
A smoothed version of the MACD line. Crossings between the two are the classic, and weak, signal.
Signal to noise
How much of what you see is meaningful versus random. It gets worse the faster the chart.
Signing
Proving a transaction is really from you, using your private key, without revealing the key.
SIM swap
A thief takes over your phone number to intercept text message codes. Why app codes beat texts.
Simulator
A practice account. The prices are real, but the money is pretend, so a mistake costs nothing.
Single source of truth
One record you trust, backed up, rather than several that disagree.
Size ceiling
The point where your order is big enough that adding capital adds cost faster than profit.
Used in: Measuring execution: arrival price, slippage logs, TWAP and iceberg orders
Size ladder
Predefined stages, each needing a completed sample before the next.
Slashing
Destruction of part of a validator stake as a penalty for misbehaviour in a proof-of-stake network.
Slippage
The difference between the price you expected and the average price you got, caused by your own size and by the market moving.
Slippage assumption
What you assume your fills cost. Assuming zero is the most common way to fake a good result.
Slippage tolerance
On a decentralised exchange, how much worse a price you will accept before the trade cancels.
Slope
Whether the average is pointing up or down. A flat average carries no information.
SMA
Simple moving average. Every period counts equally. Smoother and slower.
Small cap
A coin worth a few hundred million or less. Prices jump around and it is hard to sell in size.
Smart contract
Code deployed to a blockchain that executes automatically. It can be upgradeable, and the key that upgrades it is a risk worth checking.
Social engineering
Tricking a person, not a computer, into giving up money or secrets.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
Spoofing
Displaying large orders with no intention of filling them, to lure other traders into acting. A wall that vanishes on approach was never real.
Spot
Trading the asset itself for immediate settlement, with no leverage and no liquidation.
Spot ETF
A fund traded on a stock exchange that holds the actual coins, letting ordinary brokerage accounts buy bitcoin.
Used in: January 2024: buy the rumour, sell the news, then a new high
Spot margin
An exchange account that lets you borrow coins or cash against money you have deposited.
Used in: Spot margin, borrowing costs and how shorting really works
Spread
The gap between the best bid and the best ask. You pay it on every round trip.
Squeeze
When the bands narrow to their tightest in months. Volatility has compressed and expansion usually follows.
Stablecoin
A token designed to hold a value of one dollar. Fiat-backed, crypto-backed and algorithmic designs carry very different risks.
Stablecoin supply
Total dollars sitting in stablecoins. Growing supply is money entering, ready to deploy.
Stage
One rung of the ladder, with its own trade count and risk percentage.
Staking
Locking tokens to help secure a proof-of-stake network in exchange for rewards, usually with a lock-up or unbonding period.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Standard deviation
A measure of how spread out numbers are. Wide spread means high volatility.
Stop
The order that sells for you at the invalidation price, so the loss stays small.
Used in: From chart to trade: planning a trade in the simulator
Stop distance
How far the stop sits from entry, in price or as a percentage.
Stop hunt
Price poking just past an obvious level to trigger other people's stop losses, then reversing.
Stop loss
An order that exits a position at a price where the reason for the trade is no longer true. It moves toward profit only, never away.
Stop market
A stop that becomes a market order when triggered, so it always gets you out, even in a cascade.
Used in: Measuring execution: arrival price, slippage logs, TWAP and iceberg orders
Stop-limit
A stop that, once triggered, sends a limit order. You control the exit price and accept it may not fill in a fast gap.
Strategy document
Written rules covering universe, filter, setup, trigger, risk, exit and review.
Stretch
How far price has run from its 20 period average, measured in ATR. Too far is a poor place to enter.
Strike
The fixed price the option lets you trade at.
Used in: Options: defined risk and what you are really buying
Structural edge
Profiting from people who must trade for reasons that have nothing to do with price.
Structural stop
A stop placed beyond the swing level that defines the trend. Tied to your actual reasoning.
Structural supply
Coins sold on a schedule for reasons that have nothing to do with price: miners paying bills, teams paying salaries, investors unlocking.
Structure
The pattern of swing highs and lows that defines the trend.
Sub-account
A separate small account inside your main one, with its own balance.
Sunk cost
Money already spent. The feeling that you must pay more to save it keeps victims paying.
Used in: Pig-butchering, fake platforms and the scams aimed at you personally
Supply
How many coins exist. Bitcoin will never have more than 21 million, and anybody can check that number themselves.
Support
A price area where buyers have stepped in before, so price tends to stop falling there.
Used in: Support, resistance and how to draw levels properly
Support and resistance
Price zones where significant trading occurred before, so orders and attention cluster there. Zones, not exact lines.
Survivorship bias
Testing only on assets that still exist, quietly excluding everything that failed.
Swing high
A local peak: a candle whose high is above the few candles either side of it.
Swing high and low
A local extreme surrounded by lower highs or higher lows. Swings define trend structure.
Swing low
A local dip: a candle whose low is below the few candles either side of it.
T
Take profit
An order that exits automatically once you are up by the amount you planned.
Take-profit
An order that closes a trade for a profit once price reaches your target.
Taker
A trader whose order crosses the spread and removes liquidity. Takers pay the higher fee.
Target
The price where you plan to take your profit.
Used in: From chart to trade: planning a trade in the simulator
Taxable event
Something that creates a tax consequence. Often includes swaps, spending and rewards, not just selling for cash.
Template
A complete, ready-made set of rules you can follow exactly.
Test set
A portion held back, looked at once. Each extra look burns it.
Thesis
Your written reason for owning something.
Used in: Investing, DCA and trading are three different jobs
Theta
For options, the daily loss of value from time passing. Rent for the buyer, income for the seller.
Used in: Options: defined risk and what you are really buying
Third-party payment
A payment that arrives from someone other than your counterparty. A red flag: it can be stolen money that freezes your account.
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
Tier-one event
The releases that reliably move the whole market: CPI, FOMC and payrolls.
Tilt
Trading to feel better rather than to make money. Borrowed from poker.
Time decay
Options losing value as expiry approaches, all else equal.
Used in: Options: defined risk and what you are really buying
Time horizon
How long you plan to hold before you sell.
Used in: Investing, DCA and trading are three different jobs
Time stop
Exiting because the trade has not worked within a set number of periods. Underrated.
Timeframe
How much time one candle covers. A 1 hour candle covers one hour.
Timeframe shopping
Switching charts until you find one that agrees with the trade you already wanted. A reliable way to lose money.
Token
A coin that lives on somebody else's blockchain, rather than having its own.
Token approval
A permission you sign before a contract can move your tokens. Cap it at the amount you are swapping.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
Token unlock
A scheduled release of new coins onto the market. It is scheduled selling you cannot trade against.
Tokenomics
A token supply schedule, allocation and value capture. It determines long-run returns more than the roadmap does.
Top down
Deciding total exposure first, then splitting it, then sizing individual positions.
Total supply
Coins that will eventually exist, including those not yet issued.
Touch
One occasion when price reached a level and reacted to it.
Used in: Support, resistance and how to draw levels properly
Trade plan
Four lines written before entry: what, where in, where wrong, where out and how big.
Trading bucket
Active capital for positions from your written strategy.
Trading pair
What you are swapping for what. BTC/USDT means bitcoin priced in dollars.
Trailing stop
A stop that follows price at a set distance and only moves in your favour. A concept for a real venue; not on this simulator.
Training set
The portion of data you develop and tune on.
Transaction
One movement of coins from one address to another. Like a single line in a bank statement.
Treasury
Tokens the project holds to fund itself. Spending it is selling into the market.
Trend
A consistent direction. It has a definition you can check, not just an opinion.
Trend follower
A fund that buys things going up and sells things going down, by a fixed set of rules.
Trendline
A straight line joining swing lows in a rising market, or swing highs in a falling one.
Used in: Marking up a chart: drawing levels, trendlines and Fibonacci
Trigger
A rule that decides the exact moment you enter. What moving averages are bad for.
Trigger chart
The fastest chart. It decides the exact moment you enter and where the stop goes.
TVL
Total value locked in a protocol. It can be inflated by incentives and by the same capital counted through several layers.
Used in: DEX swaps, staking and DeFi yield: the on-chain side of trading
TWAP
Time-weighted average price: slicing one order into equal pieces sent at intervals, so the book refills between them.
Used in: Measuring execution: arrival price, slippage logs, TWAP and iceberg orders
Two-factor
A second step when logging in, from an app on your phone. The single most useful thing you can turn on.
Two-factor authentication
A second proof at login, such as a code from an app, on top of your password.
U
Universe
The written list of markets you allow yourself to trade. It changes slowly and every name passed the same filters.
Unlock
A scheduled date when vested tokens become transferable. Large unlocks relative to daily volume are serious supply events.
Unlock schedule
A published calendar of when coins held by the team and early investors become sellable.
Unwind
Closing carry trades in a hurry, which means selling the assets that were bought with the loan.
Unwinding
Positions closing in an orderly way, so open interest falls without violence.
UPS
A battery box that keeps a computer running for a while when the power goes.
Uptrend
Each peak is higher than the last, and each dip is higher than the last.
USDC
A stablecoin from Circle, common in regulated markets but often less liquid on local boards.
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
USDT
Tether. The most widely traded stablecoin on African peer-to-peer markets, usually sent on the Tron network.
Used in: Stablecoins as cash: P2P, mobile money and moving money in and out in Africa
V
Validator
The same job as a miner, but chosen by how many coins it has locked up rather than by computing power.
Value capture
Whether the token actually receives any of the money the protocol makes.
Variance
Random swing in results. It dominates over small samples and fades over large ones.
Vega
Sensitivity to implied volatility. Why a correct call can still lose.
Used in: Options: defined risk and what you are really buying
Verification tier
How much an exchange lets you withdraw, based on the documents you have provided.
Vesting
The schedule by which team and investor coins gradually become sellable.
Volatility
The size of price movement. It clusters: quiet periods follow quiet periods and violent ones follow violent ones.
Volatility adjusted
Sized so that a more volatile asset gets a smaller position, equalising the risk.
Volatility crush
Implied volatility collapsing after an event, making options cheaper even if you were right.
Used in: Options: defined risk and what you are really buying
Volatility regime
Whether the market is in a calm period or a violent one. They cluster: calm follows calm, violent follows violent.
Volatility stop
A stop placed a multiple of ATR away, so it adapts to how much the market is moving.
Volume
How much was traded in a period. Shown as bars under the price chart.
Volume profile
Volume measured per price rather than per unit of time. Price moves slowly through high volume nodes and quickly through low volume ones.
W
Walking the band
Price hugging the upper band for many candles. A sign of strength, not of exhaustion.
Walking the book
What happens when your order is bigger than the first row: it eats row after row at worse prices.
Wallet
Software or a small device that stores your keys. It does not hold coins; it holds proof that coins are yours.
Wash trading
Trading with yourself to inflate reported volume. Suspect it when most of a token volume sits on a single minor venue.
Watchlist template
One row per market with regime, ATR, levels, strength, events and a status, refreshed weekly.
Weekend gap
A sharp move while stock markets are closed, when crypto is the only large market open to sell.
Weekly review
A short scheduled look at the week, focused on decisions rather than money.
Whale
A holder large enough to move the market. Most large on-chain transfers flagged as whale activity are internal exchange movements.
Whipsaw
Being stopped out repeatedly by a market that keeps changing its mind. What crossovers do in a range.
Wick
The thin line above or below a candle body, marking a price that was reached and rejected within the period.
Win rate
The share of trades that make money. On its own it tells you nothing.
Withdrawal
Moving money or coins off an exchange. Often has a limit you must raise in advance.
Withdrawal whitelist
A list of addresses you approved earlier. Money can only be sent to those.
X
XP
Points you earn for finishing lessons, passing exams and clearing reviews.
Y
Yield farming
Moving capital between protocols to chase incentive rewards. The reward token is usually the thing being sold into your deposit.
Z
Zero line
On MACD, the level where the fast and slow averages are equal. Crossing it is a cleaner cue than the signal cross.
Zone
A band of prices rather than a single line. The honest way to draw a level.
Used in: Support, resistance and how to draw levels properly