The trading and investing world can be so overwhelming with a lot of things to learn. So below have highlighted the major terminologies you must understand if you find yourself trading either Crypto or Forex.
These terms are taken from one of the best Cryptocurrency course available out there titled “Cryptocurrencies & Wyckoff“. They are defined with how they are used in the text and at Wyckoff SMI.
I’m sure you will find it beneficial, so read through and thank me later.
96 Crypto And Forex Terms
- Absorption: The reduction of the floating supply caused by persistent longer-term buying within a trading range.
- Accumulation: The establishment of an investment or speculative position by professional interests in anticipation of an advance in price.
- Advance: A rise in price or an upward movement in a coin or index.
- Angle of Advance: The inclination of a rising price trend.
- Angle of Decline: The inclination of a lowering price trend.
- Apex: The focal point of converging support and supply lines. (See dead center, hinge, pivot, wedge).
- Average: A numerical representation which purports to reflect the mean (average) price of a particular class of coins.
- Averaging:
(1) Dollar Averaging: a periodic investing of a definite number of dollars irrespective of the number of coins involved;
(2) Share Averaging: periodic purchases of the same number of coins irrespective of the number of dollars required.
(3) Averaging Up: periodic purchases on a rising scale whose purpose generally is to pyramid profits; and
(4) Averaging Down: periodic purchases as a price declines, which has the general purpose of lowering the mean cost of the coin. - Bear: A speculator who concludes that the probable future trend will be one of declining prices.
- Bear Market: A market condition characterized by declining prices.
- Breakthrough: A price movement above/below a previous supply/support area.
- Bulge: A sudden expansion of price or volume. (However, bulge generally is used in reference to volume. volume.)
- Bull: A speculator who concludes that the probable future trend will be one of advancing prices.
- Bull Market: A market condition characterized by advancing prices.
- Buying Climax: A situation characterized by the highest intensity of speculative demand occurring within an uptrend. This situation occurs only after a move has been in effect for some time. This condition marks the end or the approaching end of the particular uptrend.
- Campaign: An organized market operation for the purpose of moving the price of a coin.
- Commitment: A market position in a coin or other trading medium.
- Composite Average: An index composed of a number of coins which is used to represent the general market. Normally constructed by adding the prices of a limited but fixed number of coins, then dividing by the number of coins making up the average.
- Composite Man: The term used to refer to the sponsors or large professional interests in the market, also called composite operator.
- Cover: The act of buying a coin previously sold short. (See short sale, short covering).
- Culminating: The ending of a move.
- Day Order: An order to buy or sell which is good only on the particular day on which it is made.
- Dead Center: The focal point of converging support and supply lines. (Also, apex, hinge, pivot wedge).
- Deduction: The form of logic or reasoning which proceeds from the general statement to the specific case.
- Distribution: The elimination of a long investment or speculative position.
- Figure Charts: A chart of a coin, stock, commodity or index, which takes into consideration price movements and fluctuations. Volume and regular time intervals are not generally used in the construction of figure charts.
- Floating Supply: The supply of coin that is normally available for purchase during a given period of time.
- Force Index: An index developed by the Stock Market Institute to portray the investment factors during continuous periods of market history.
G.T.C. (Good ’til Cancelled) A customer’s order to buy or sell coins at a specified price. The order remains in effect until it is either executed or cancelled. - Hedge: A condition in which both long and short positions are maintained by the same interests.
- High: The highest price of a coin, security, issue, index, etc., for a specific time period. Generally , the highest price of the day.
- Hinge: The focal point of converging support and supply lines. (See apex, dead center, pivot, wedge).
- Hypodermics: A deliberately forced, fast mark-up in the price of a coin. The purpose of hypodermics is the stimulation of uninformed buying in order to facilitate distribution.
- Index (Price): A statistical instrument which is used to determine the trend of a particular class of security. This is not an average.
- Induction: The reasoning process or logic which begins with specific cases and proceeds to a broad generalization.
- Inside Day: A day for which the high and low prices are, respectively,lower and higher than those of the preceding day.
- Institutional Investors: Generally, large corporate investors such as banks, insurance companies, investment trusts, mutual funds, pension funds, colleges and universities, and charitable foundations.
- Intermediate Trend: A price movement which has two basic characteristics. These are (a) a move of approximately 15% of its value and (b) a duration of two weeks to two months.
- Intra-Day Wave Chart: A continuous line chart reflecting the price swings occurring entirely within a single day’s trading (IDWC).
- Investment Position: Coin holdings established for investment purpose only.
- Law of Supply and Demand: The basic economic law used to explain the cause of all price changes.
- Limit Order: An order to buy or sell only at a specified price or at one more favorable than the specified price.
- Line of Least Resistance: The trend of coin prices, whether it be advancing or declining.
- Locked-In: A psychological state of mind which exists when an individual believes that he cannot afford to liquidate a security position.
- Long: The ownership of coins.
- Long-Sale: The sale of a long coin position.
- Long Terms: Financially , it is considered to be a five year investment; the tax definition can be different.
- Low: The lowest price of a coin, security, issue, index, etc., for a specific time period. Generally, the lowest price of the day.
- Margin: The amount of money deposited by a customer when he uses credit to buy coins, the balance being financed or advanced by the broker/exchange.
- Mark-Down: A sustained downward price movement.
- Market Order: An order to buy or sell at the best price available at the time the order is received.
- Mark-up: A sustained upward price movement.
- Option: A contractual right to buy or sell a security at a specified price within a specified period of time.
- Optimism-Pessimism Index: An index developed by Wyckoff SMI which reflects the optimism due to buying and pessimism due to selling during any specific period of market history.
- Overbought: A condition in which the supply – demand relationship for a particular class of coins is such that normal equilibrium between economic forces exists only at a price below that at which the current trades are being made.
- Preparation: Transactions designed to affect the supply – demand relationship for a security order to facilitate its future price move.
- Pressure: Sustained selling of a coin.
- Primary Distribution: The initial liquidation of a long position.
- Process of Rotation: The principle that all coins of a class do not prepare, advance, or decline at the same time. Some coins lead the various stages while others lag.
- Pyramid: The use of accrued profits to enlarge a speculative position.
- Rally: A short term advance in the price of any coins, securities or class of securities.
- Reaction: A short term decline in the price of any coins, securities or class of securities.
- Resistance: Opposition to advancing prices caused by an increase in the available supply.
- Secondary Distribution: The liquidation of a long coin position occurring after primary distri-bution but prior to the next mark-down phase. A plateau in a big down move.
- Selling Climax: A situation characterized by the highest intensity of speculative supply occurring within a downtrend. This situation occurs only after a move has been in effect for some time. This condition marks the end or the approaching end of the particular downtrend.
- Shakeout: A deliberately forced price reaction, whose purpose is that of stimulating public selling in order to facilitate the accumulation of speculative positions.
- Short Covering: Buying a coin to eliminate or close out a short position.
- Short Position: Coins, securities and/or commodity future contracts sold short.
- Short Sale: Sale of a borrowed coin by a person who believes the price will decline. i.e. You place an order to sell short 200 coins.
- Speculation: To assume a market risk in expectation of gain; especially, to buy or sell in expectation of profiting from market fluctuations.
- Springboard: A condition in the price movement of a coin that has completed preparation and has been brought to a point where the coin may move into a mark-up or a mark-down period.
- Stop Limit Order: An order to buy or sell which becomes a limit order as soon as the coin’s price reaches or sells through a specified stop price.
- Stop Order: An order to buy or sell which becomes a market order as soon as the price of the coin reaches or sells through the specified price.
- Straddle: Going long in one coin and short in another.
- Strength: A coin reflects strength when its price shows the ability to advance.
- Strong Technical Position: Condition in which normal available demand exceeds floating supply.
- Supply Line: In a downtrend a line connecting at least two important points of supply.
- Support: Opposition to declining prices caused by the increase in available demand.
- Tape Reader: A person trained to determine the characteristics of market fluctuations, using data which he derives from the order book.
- Technical Rally: A technical rebound. A part of a typical selling climax. (Automatic rally)
- Technical Reaction: Opposite of technical rally-part of a typical buying climax.(Automatic reaction)
- Technometer: An index developed by the WyckoffSMI for the purpose of indicating normal extremes in the supply – demand conditions.
- Terminal Shakeout: A sharp downward thrust through a previous support area. Executed for the purpose of buying all the coin possible from weak or vulnerable holders.
- Terminal Thrust: A temporary bulge through the top of a trading range which fails to hold.
- Thrust: The price difference between consecutive tops in uptrends or between consecutive bottoms in downtrends.
- Thrust Movement: A sharp run-up out of an area of distribution; or a temporary bulge through the top of a trading range which fails to hold (Synonym: upthrust).
- Trade: To buy or sell coins, stocks, securities, options, etc.
- Trading Range: A condition characterized by temporary price trends, which are offset by ensueing moves in the opposite direction, and by a persisting equilibrium in the supply – demand relationship.
- Trend: The line of least resistance. It is the direction in which a price is moving.
- Trend Charts: These are charts which graphically depict the trend of a coin, the general cryptocurrency market, or index.
- Turning Point: The place at which a coin price trend reverses its direction.
- Upthrust: A sharp price movement above a prior supply level, which does not hold, but immediately reacts below that previous level.
- Vertical Line Charts: Charts which graph the volume, high, low, and closing prices for the day, week, month, or year of any coin or index.
- Weakness: The ability of price to decline.
- Weak Technical Position: A condition in which normal available demand is exceeded by the floating supply.
- Wedge: The focal point of converging support and supply lines. (See apex, dead center, hinge, pivot.)
- Whipsawed: A situation in which a speculator is repeatedly wrong no matter what he does. It usually results from buying at the tops and selling at the bottoms.
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