Day Trading Terms
SCALPING GLOSSARY
If you want to understand traders’ language, it's a must read for you.
А
Use your entire trading deposit to open one or more positions.
The highest price for a particular cryptocurrency ever recorded in history
Or an alternative coin: Any cryptocurrency other than BTC (Bitcoin)
The same as Altcoins
American Depositary Receipt (от ADR) - it is a kind of derivative security. The underlying asset of ADRs is the securities of a foreign company.
ADRs are needed for investors on American stock exchanges that can freely trade shares of companies from other countries. The holder of ADRs usually has the same rights as the holders of the shares (including the right to receive dividends). ADRs are traded in US dollars.
ADRs are needed for investors on American stock exchanges that can freely trade shares of companies from other countries. The holder of ADRs usually has the same rights as the holders of the shares (including the right to receive dividends). ADRs are traded in US dollars.
Ask – selling orders in the order book. Ask price - the offer price or the lowest price at which the seller agrees to sell. In scalper terminals, asks are located in the upper part of the glass. Market orders are executed instantly at the bid / ask price.
Increasing the position in order to form an average price. This is the strategy that refers to the practice of buying/selling at consistently lower/higher prices to improve the average price of a desired long/short position.
B
A method of displaying the price of an exchange instrument for a certain period of time, an alternative to line charts and Japanese candlesticks.
In the US, bars are more popular, in Europe and Asia, traders prefer Japanese candlesticks on charts. Generally, 99.9% of CScalp trades use candlestick charts.
Example: Chart of the same instrument, represented by bars (left) and candles (right).
In the US, bars are more popular, in Europe and Asia, traders prefer Japanese candlesticks on charts. Generally, 99.9% of CScalp trades use candlestick charts.
Example: Chart of the same instrument, represented by bars (left) and candles (right).
The currency for which a trader buys or sells cryptoassets. For example, in the BTCUSDT currency pair, USDT will be the base currency.
Falling market, leading market sellers (bears) pushing prices down.
So-called sellers.
Buy orders in the order book. In scalper terminals, bids are located in the lower (green) part of the order book.
Traders that place buy limit orders.
Bitcoin is the first and historians' main cryptocurrency, according to legend, created by Satoshi Nakamoto. The key features of Bitcoin are decentralization, anonymity, and security.
Bitcoin is considered a correlation instrument for other cryptocurrencies. If Bitcoin rises, it will push other cryptocurrencies to rise as well. Likewise, the value of altcoins decreases when BTC falls. In practice, scalpers observe bitcoin when trading any cryptocurrency.
The first 50 BTC were generated on January 3, 2009. Bitcoin issuance will cease around 2140, after 21 million tokens have been issued. At the moment, for one reason or another, about 28.5% of BTC of the fixed emission size has been lost.
Bitcoin is split into smaller pieces. So, 1 BTC = 100,000,000 Satoshi.
Bitcoin is considered a correlation instrument for other cryptocurrencies. If Bitcoin rises, it will push other cryptocurrencies to rise as well. Likewise, the value of altcoins decreases when BTC falls. In practice, scalpers observe bitcoin when trading any cryptocurrency.
The first 50 BTC were generated on January 3, 2009. Bitcoin issuance will cease around 2140, after 21 million tokens have been issued. At the moment, for one reason or another, about 28.5% of BTC of the fixed emission size has been lost.
Bitcoin is split into smaller pieces. So, 1 BTC = 100,000,000 Satoshi.
Bollinger (Bollinger Bands) is a technical analysis indicator that displays possible price deviation from its moving average (MA). The indicator is designed to measure market volatility and determine the overbought/oversold level of a trading instrument. If the price goes beyond the Bollinger Bands, it can serve as a signal for the price to return to the trading band. Read more about Bollinger Bands and other technical analysis indicators here.
A debt security that obliges the issuer (who issues the bond) to pay a certain amount and interest on the use of the funds within a specified time.
The price level that has no profit or loss in an open trade. In other words, breakeven is a situation when the price returns to the point at which a trade was opened.
A bull market is a growing market dominated by buyers (bulls) pushing the price up.
During the bull market, the price may rise for no objective reason, since the bulls "move" the ticker in the direction they need. The bull market is great for scalping trades.
The bull market can be of two types, depending on the scale:
local bull market - growth of ticker of a certain exchange asset;
global bull market - growth of most assets and the market.
The global bull market can be identified by the growth of stock percentage. In a global bullish trend, buying assets carries fewer risks than in a local bullish trend.
During the bull market, the price may rise for no objective reason, since the bulls "move" the ticker in the direction they need. The bull market is great for scalping trades.
The bull market can be of two types, depending on the scale:
local bull market - growth of ticker of a certain exchange asset;
global bull market - growth of most assets and the market.
The global bull market can be identified by the growth of stock percentage. In a global bullish trend, buying assets carries fewer risks than in a local bullish trend.
Bulls are the buyers. Bulls are pushing the market up.
Bulls buy assets at the time of market growth at the lowest price. When the asset value peaks, the bulls sell. The bulls have no interest in the falling market, during this period they are inactive.
The growth of asset quotes is called "bullish trend" or "bull market". At the same time, the value of quoted currencies decreases. Bull traders are interested in market growth and capital inflows.
Bulls buy assets at the time of market growth at the lowest price. When the asset value peaks, the bulls sell. The bulls have no interest in the falling market, during this period they are inactive.
The growth of asset quotes is called "bullish trend" or "bull market". At the same time, the value of quoted currencies decreases. Bull traders are interested in market growth and capital inflows.
Buying securities/tokens.
The main idea of "Buy the dip" is to buy assets only after their correction (fall). It’s obvious to everyone that it’s better to buy assets when they’re cheaper. The main problem here is that no one can identify the bottom. So it might be premature to buy a correction.
The phrase is applied to beginners who make unprofitable trades and still do not know how to win back in plus. Buy experience from the market – your minuses and unprofitable trades meaning that you are gaining new experience in trading.
C
One of the methods of graphical price display (line chart, bars, candlestick chart).
The time when the exchange makes settlements between its clients for goods delivered or sold to each other, securities. Settlements for services rendered, carried out by mutual offset, based on the terms of the balance of payments.
A kind of exchange robot with an algorithm of correlation. Robots consider correlations between different instruments and try to work on correlations. These robots work very fast and they make trades in seconds.
Example: The robots predicted that Bitcoin grows, so LINK will also grow. As Bitcoin grows, the correlators buy LINK based on its growth.
Example: The robots predicted that Bitcoin grows, so LINK will also grow. As Bitcoin grows, the correlators buy LINK based on its growth.
1. Corrective trend, a medium-term trend in the market, the direction of which does not coincide with the direction of the long-term trend.
2. A new, oppositely directed trend, comparable in strength to the previous one.
2. A new, oppositely directed trend, comparable in strength to the previous one.
D
Downside is the potential negative movement, while downside risk looks to quantify that potential move. For the most part, the higher the downside potential the greater the upside potential. This goes back to the idea of the higher the risk, the higher the reward. Upside is the positive move in an asset price.
The maximum daily loss, upon reaching which the trader must stop trading. For example: if the drawdown is 100$, then when the total loss for a trading session reaches this figure, the trader stops trading thereafter. The term came from proprietary trading.
E
A special service that allows you to change different cryptocurrencies among themselves or for real money (fiat).
On the day of expiration, the exchange delivers and settles all open positions in the futures and options market. The auctions are held by the next contracts by the date of execution.
The situation when a trader tries to “catch” all extreme points on the price chart.
Ex-dividend describes a stock that is trading without the value of the next dividend payment. The ex-dividend date or "ex-date" is the day the stock starts trading without the value of its next dividend payment.
Typically, the ex-dividend date for a stock is one business day before the record date, meaning that an investor who buys the stock on its ex-dividend date or later will not be eligible to receive the declared dividend. Rather, the dividend payment is made to whoever owned the stock the day before the ex-dividend date.
Typically, the ex-dividend date for a stock is one business day before the record date, meaning that an investor who buys the stock on its ex-dividend date or later will not be eligible to receive the declared dividend. Rather, the dividend payment is made to whoever owned the stock the day before the ex-dividend date.
F
A type of strategy that is used for trading against the main trend. Usually it’s used by experienced traders.
A situation when the price overcomes an obvious level, but then suddenly changes direction.
Fibonacci are the tools for market analysis. The following instruments have traditionally been used for market analysis: Levels F, Time Zones F, Extension, Channel, Fibonacci Arcs.
(trading flat, consolidation)
A situation when the market fluctuates in a channel. The opposite of a trending market.
Most of the time the market is sideways, the smaller part is moving directionally. Typically, scalpers wait for the trend and refrain from trades when the market is flat.
A situation when the market fluctuates in a channel. The opposite of a trending market.
Most of the time the market is sideways, the smaller part is moving directionally. Typically, scalpers wait for the trend and refrain from trades when the market is flat.
The situation when the price goes up or down from the flat (consolidation zone).
There are several meanings.
1. A classic scalping technique, when a buying/selling order is placed before a large order. In the purpose that a large bid will play a supportive/resistant role.
2. It is an unethical and in some cases illegal practice for a broker to place an order before a large client order (which the broker believes will cause the market to move).
3. Algorithmic trading strategy. Based on automatic analysis of the number of orders in the Depth of Market. A trade is executed when an order appears near the bid/ask prices, significantly exceeding the average volume of orders in the order book or the average volume of trades for the last time. The sense of the strategy: before the majority of orders will be filled, the market will bounce several times in the opposite direction.
1. A classic scalping technique, when a buying/selling order is placed before a large order. In the purpose that a large bid will play a supportive/resistant role.
2. It is an unethical and in some cases illegal practice for a broker to place an order before a large client order (which the broker believes will cause the market to move).
3. Algorithmic trading strategy. Based on automatic analysis of the number of orders in the Depth of Market. A trade is executed when an order appears near the bid/ask prices, significantly exceeding the average volume of orders in the order book or the average volume of trades for the last time. The sense of the strategy: before the majority of orders will be filled, the market will bounce several times in the opposite direction.
See "Fundamental analysis".
Fundamental analysis – collection and analysis of information that affects the value of the asset. This is usually the study of the company's financial and accounting statements to determine the fair value of its securities and forecast future earnings.
The main methods of fundamental analysis include:
• comparison method;
• seasonality;
• deduction and induction;
• correlation method;
• generalization.
The main methods of fundamental analysis include:
• comparison method;
• seasonality;
• deduction and induction;
• correlation method;
• generalization.
Futures – futures contracts, often referred to as futures, are agreements that bind traders to buy or sell assets in the future at a specific price and date.
Futures – it is a derivative instrument belonging to the base asset. Also, a futures contract is called a “futures” because it has an expiration date (except for perpetual futures).
Example: the buyer and seller agree on a 5 BTC at the price of $35,000 on February 12, 2021. On this day, the seller must sell the coins at a set price, regardless of the current BTC rate. Also, the buyer is obliged to buy bitcoins at the agreed price.
Futures – it is a derivative instrument belonging to the base asset. Also, a futures contract is called a “futures” because it has an expiration date (except for perpetual futures).
Example: the buyer and seller agree on a 5 BTC at the price of $35,000 on February 12, 2021. On this day, the seller must sell the coins at a set price, regardless of the current BTC rate. Also, the buyer is obliged to buy bitcoins at the agreed price.
G
Strong price change at the opening of the market.
H
Means that a trader sells at the prevailing bid price in a market.
Inexperienced traders.
I
Listing of tokens is the issuance of coupons or tokens by some project intended to pay for services on sites in the future in the form of cryptocurrency. At the same time, unlike an IPO, currency consumers do not receive shares in the company and cannot influence general management decisions in any way.
Exchange instruments with low liquidity. They usually have a non active order book and a large spread.
Liquidation of Stop-Loss orders of other market participants.
A value calculated from stock data (price, volume, etc.).
Non-public information of the company. In case of public disclosure, the market value of the company’s securities may be changed.
A type of trading which positions are occured within a single trading session.
Initial Public Offering
The first public sale of shares of the company.
The first public sale of shares of the company.
Issue and listing of new shares on the securities market.
K
A sharp price pullback against the main market movement. "Catching knives" means entering a position when the trader believes that the movement is over and that there will now be a strong movement back.
Catching knives is a dangerous type of trading, it is not recommended for beginners. The danger is that the movement with a high degree of probability can continue and bring a loss to the trader.
Catching knives is a dangerous type of trading, it is not recommended for beginners. The danger is that the movement with a high degree of probability can continue and bring a loss to the trader.
Check «knife»
L
A price level of support or resistance that is of interest to participants. Considered as a technical analysis tool.
A limit order (order) that is executed at a specified price.
This is a procedure for closing a trader's position by the exchange in order to avoid large losses during margin trading. A liquidation occurs when the market price goes against the open position and your margin is not enough to cover the loss. Crypto exchanges determine the approximate liquidation price for each position in advance, and thanks to this, the trader can determine the setting of stop loss.
The ability to sell or buy an asset without causing big impacts in the market price.
Example: if you look at an order book of PLZL shares and SBER shares, you can conclude that the second order book is more liquid. For a scalper, liquidity is the thing of how full the order book is in relation to the number of orders.
Example: if you look at an order book of PLZL shares and SBER shares, you can conclude that the second order book is more liquid. For a scalper, liquidity is the thing of how full the order book is in relation to the number of orders.
Buying position.
A sharp price movement, provoked by the stop orders of the market participants.
Local (or historical) price minimum of an instrument.
M
A professional participant who forms and supports the exchange market, thanks to them, bidders have the opportunity to make trades fairly quickly.
Market order is the type of order while the position will be opened instantly. At the best current price.
The general news background of the market is positive or negative.
The value of the middle value from a set of values sorted in ascending or descending order. In other words, it is the value that divides the set of values in half.
A service that allows you to "mix" many bitcoins or other cryptocurrencies in order to confuse the traces of their origin. Often used to hide traces of "dirty" money.
N
An indicator perceived by the US labor market. Informs about how many new jobs have appeared in different sectors of the economy that are not covered by agriculture (non-farm). This is the second most important economic indicator (the first is GDP). Statistics on this indicator are released on the first Friday of each month.
O
A contract that gives the buyer the right (but not the obligation) to buy or sell a specified asset at a specified price or before a specified date.
All types of orders to buy or sell.
An order book lists all the open orders with different offers from buyers and sellers for an underlying asset.
Updating the local (or historical) price maximum for an instrument.
P
Chart patterns are stable, repeating combinations of price, volume, or indicator data.
The time taken to send a request from the client to the server and back from the server to the client.
A highly profitable way to trade. The goal of this strategy is to get every small profit (in a few points).
Opened trade in any direction. "To be in a position" - to have a certain number of bought or sold exchange instruments. "Close position" - make a reverse trade and bring the previously opened position to zero.
Exists along with the premarket. It is held in the auction mode, based on the results of which the closing price of the day is determined. Counter orders are reduced and executed at this price.
Preliminary auctions for shares, which are made some time before the opening (after closing) of the main trading session.
Usually, this phrase refers to a situation where someone throws a price down/up (a large participant or a robot).
A profit is an amount of money that trader gains.
A type of business where a company attracts traders and provides them with trading capital. The resulting profit is divided between the trader (most) and the company (smaller).
Pullback (rollback) – return of the price to the previous values. This term is often used for false breakouts, for example, when there is an impulse, and price pulled back (rolled back) thereafter.
The process of artificially inflating the value of a cryptocurrency by buying huge amount of orders.
A mythical character in the financial markets who can change the price of an asset in any direction at any time for personal gain. Everything that is done on the stock exchange is done according to the will of the puppet master and for his personal benefit.
Q
The current price of any asset.
R
Take reasons to enter a trade by analyzing the chart.
Relative Strength Index (RSI) is a technical analysis indicator used to determine the strength of the current trend. Overbought / oversold data indicator of a trading instrument.
RSI analyzes recent dynamic data and data in the form of an oscillator ranging from 0 to 100. Read more about the relative strength index and other technical analysis indicators here.
RSI analyzes recent dynamic data and data in the form of an oscillator ranging from 0 to 100. Read more about the relative strength index and other technical analysis indicators here.
The same as the «To the moon» expression because of the sharp growth in the price of a particular asset.
S
A trading style that is characterized by the frequency of trades and a short-term holding of position.
A small program written in a programming language and used to facilitate the trading process. This program is designed to perform a single action. Once this script operation is completed, the script will be removed. And only after restarting, it will be necessary to run it again.
Short position (selling).
The possibility to place your Stop-Loss next to the opening of a position.
The term “slippage” refers to the possibility of executing stop limit/stop loss orders at a price worse than indicated in the order.
A sharp increase in trading volume is usually accompanied by an increase in prices.
A trader that uses spoofing as a trading activity.
Placing orders in the trading terminal and canceling them before of the execution. This tool is used by professional traders in world markets with a large amount of capital. Spoofing is not possible for private traders. In a number of countries, such actions are prohibited by law. When a trader sees such bids, he can see that someone is deliberately disrupts the market.
Base currency asset.
The distance between the best selling (ask) and buying (bid) prices at the same time on an asset (stock, commodity, currency, futures, options).
Cryptocurrencies based on an asset. Example: USDT is a United States dollar-denominated stablecoin. In fact, it is the cryptocurrency equivalent of a common dollar that is quoted to the dollar one-to-one.
Statistical arbitrage is a trade strategy based on a deep market analysis and serves to identify and find undervalued or overrated cryptocurrencies. The main challenge is to find a statistical relationship between different coins and use this relationship to obtain benefits.
The stochastic oscillator is a technical analysis indicator that shows the observed behavior of the price of an instrument relative to the price range for an n-period in the past. Stochastic is designed to determine the momentum of the price and is measured as a percentage.
A stock is an equity security giving its owner the right to participate in the management of a joint-stock company and the right to receive part of the profit in the form of dividends.
Scalpers trade only stocks that large number of trades are made per day. There are stocks that have several trades are made per month on the exchange. Such papers are not suitable for scalping, even if the company is well-known and reliable.
Scalpers trade only stocks that large number of trades are made per day. There are stocks that have several trades are made per month on the exchange. Such papers are not suitable for scalping, even if the company is well-known and reliable.
Stocks in play are that instruments that are growing or falling at the moment (volatile). Initially, the term was applied to speculation in stocks, but over time it began to be used for futures and cryptocurrencies.
Day traders and scalpers try to trade "stocks in play" because they can make more money. Typically, a stock becomes a "stock in play" when there is important news about it.
Example: The instrument on the chart has been in a flat position for a long time and was not of interest to traders. When it began to grow, traders began to actively trade it (volumes increased sharply). It can be said about such a tool that it has become a "stock in the play".
Day traders and scalpers try to trade "stocks in play" because they can make more money. Typically, a stock becomes a "stock in play" when there is important news about it.
Example: The instrument on the chart has been in a flat position for a long time and was not of interest to traders. When it began to grow, traders began to actively trade it (volumes increased sharply). It can be said about such a tool that it has become a "stock in the play".
A situation where the trader doesn’t place stop-loss, but keeps it in his head. If the price reaches the stop planned by the trader, a trader closes the position itself.
Orders that are unrelated to position. They are triggered while the trade is completed at a given price. "Stop limits" turn into limit orders while triggering. Such limit orders are placed at the "deferred" price.
T
A situation which is completely opposite of «To the moon», it refers to the sharp market falling regarding the news or technical analysis.
The distance that the instrument goes in 1 point of price decimalization. In other words, 1 price decimal movement = 1 tick.
Tilt is an emotional state when a trader cannot objectively rates the situation and doesn’t control himself. A series of losing trades, physical fatigue, overwork, and alcohol can provoke tilt. In most cases, tilt leads to record losses for the trader. Even the most successful scalpers have "tilt days" in their personal history.
The term came to trading from poker. Stories about "lost an apartment and a car" are stories about tilt.
It is important for traders to learn how to determine a tilt condition in themselves and stop trading before exiting this condition.
The term came to trading from poker. Stories about "lost an apartment and a car" are stories about tilt.
It is important for traders to learn how to determine a tilt condition in themselves and stop trading before exiting this condition.
The term is a metaphorical expression of the rapid and high growth (pump) in the prices of digital coins. Traders compare such pumps as the Flying to the moon, because even the chart can’t transfer how high the asset or coin jumped.
The flow of all trades that were made on the exchange. Exchanges show the fhistory anonymously - the parameters of trades are visible, but the participants are not visible. In conventional terminals, the history is presented in a tabular form. In scalping platforms the tape is displayed graphically and is associated with the order book.
A program that trades instead of a trader in an automated mode. The algorithm could be built-in in the program or set by a trader manually.
Types of trading bots:
• simple trading bots (with preset settings);
• advanced trading bots (with the possibility of customization);
• script bots (open source bots);
• signal bots (they do not trade on their own, just send a buy/sell signal);
• arbitrage bots (work on the price difference between exchanges or trading pairs);
• statistical arbitrage bots (looking for undervalued or overvalued cryptocurrencies).
Read more about trading bots here.
Types of trading bots:
• simple trading bots (with preset settings);
• advanced trading bots (with the possibility of customization);
• script bots (open source bots);
• signal bots (they do not trade on their own, just send a buy/sell signal);
• arbitrage bots (work on the price difference between exchanges or trading pairs);
• statistical arbitrage bots (looking for undervalued or overvalued cryptocurrencies).
Read more about trading bots here.
The place for recording trades made by the trader, analysis of market situations, creation of notes, detection and correction of own errors in trade.
You can use CScalp’s free trading diary here.
You can use CScalp’s free trading diary here.
V
Variation margin is calculated immediately after the buying of the futures, at the time of the price change. This is a loss/profit calculated on a position, but not written off until the position is closed.
Changes in the variation margin occur prior to the clearing settlement. After that, the variation margin is fixed - funds are either credited to the trading account or debited. The deposit / withdrawal amount is equal to the amount of the variation margin at the time of clearing.
After clearing, the variation margin is reset to zero. If the position was not closed, the variation margin starts changing again (depending on the price movement of the purchased futures until the next clearing settlement).
Changes in the variation margin occur prior to the clearing settlement. After that, the variation margin is fixed - funds are either credited to the trading account or debited. The deposit / withdrawal amount is equal to the amount of the variation margin at the time of clearing.
After clearing, the variation margin is reset to zero. If the position was not closed, the variation margin starts changing again (depending on the price movement of the purchased futures until the next clearing settlement).
Volatility - is the fluctuations of assets. In volatile assets the difference between the maximum and minimum prices for the period is greater than that of low-volatile ones.
A high level of volatility is characterized by sharp and long jumps in prices by more than 10%. At a low level, the market is at rest, fluctuations in the region of 1-2%. As a rule, traders watch the level of volatility on the chart - short and long candles represent the level of fluctuations.
Volatility drives the market. When price changes are low, there are few trades. Income tends to be generated by high fluctuations. Therefore, scalpers and active traders prefer to trade volatile assets.
A high level of volatility is characterized by sharp and long jumps in prices by more than 10%. At a low level, the market is at rest, fluctuations in the region of 1-2%. As a rule, traders watch the level of volatility on the chart - short and long candles represent the level of fluctuations.
Volatility drives the market. When price changes are low, there are few trades. Income tends to be generated by high fluctuations. Therefore, scalpers and active traders prefer to trade volatile assets.
Volume Delta is the difference between buying and selling power. Volume Delta is calculated by taking the difference of the volume that traded at the offer price and the volume that traded at the bid price.
W
List of exchange instruments that the trader is tracking.
Scalpers usually select in their watchlists the instruments they often trade or the Stocks in play (glossary term). This saves time as a trader can evaluate the situation with one look on all "his" instruments.
Scalpers usually select in their watchlists the instruments they often trade or the Stocks in play (glossary term). This saves time as a trader can evaluate the situation with one look on all "his" instruments.
A major player in the market. Generally, whales have the ability to influence stock prices.
X
The trader increases its account several times. The term comes from the notation in mathematics "2X" - the count is multiplied by two.