Glossary

Accumulation/Distribution Line

The Accumulation/Distribution Line (A/D Line) is a technical analysis indicator that measures the cumulative flow of money into and out of a security. It tries to show whether a security is being bought or sold by tracking both price and volume over time.

Average Directional Index (ADX)

The average directional index is a technical indicator that measures the strength of the ongoing trend, and it is applicable for all asset classes, stocks, forex, and commodities.

Average True Range (ATR)

ATR (Average True Range) is a technical indicator that measures how much a stock or asset moves on average during a set period, usually 14 days. It helps traders understand market volatility.

Bearish Reversal Candlestick Patterns

Bearish reversal candlestick patterns signal a potential shift in market direction from an uptrend to a downtrend, indicating that sellers may be gaining control over buyers.

Bollinger Bands

Bollinger Bands are technical analysis indicators consisting of a middle band (a simple moving average) and two outer bands (standard deviations above and below the moving average). They measure price volatility and identify potential overbought or oversold conditions.

Bullish Reversal Patterns

Bullish reversal patterns are chart formations that signal a potential change in trend direction from a downtrend to an uptrend. These patterns indicate that selling pressure may be weakening, and buying interest could soon push the price higher.

Candlestick Patterns

Candlestick patterns are formations created by one or more candlesticks that help traders understand market behaviour and predict possible price movements. These patterns are formed using the open, close, high, and low prices over a specific period.

Candlestick Timeframe

A candlestick timeframe refers to the duration or time interval that each individual candlestick on a chart represents. It defines how much market price action is displayed in each candle.

Candlesticks

Candlesticks are a type of chart used in trading that show the price movement of a stock or asset over a specific time period, such as 1 minute, 1 hour, or 1 day. Each candlestick displays the opening, closing, highest, and lowest prices, helping traders understand price action and market sentiment.

Chart Patterns

Chart patterns are visual formations created by the price movements of a stock (or any other asset) on a chart. Traders and technical analysts use these patterns to predict future price movements based on historical behaviour.

Commodity Channel Index (CCI)

The Commodity Channel Index (CCI) is one of the momentum indicators that compares the current price level to an average price level over a given period (commonly 14 or 20 days).CCI helps traders identify overbought and oversold signals.

Dark Cloud Cover Pattern

The Dark Cloud Cover pattern is a bearish reversal candlestick pattern that typically appears at the top of an uptrend. It signals that the upward momentum might be slowing down and that a potential trend reversal to the downside could be coming.

Death Cross

A death cross is a chart pattern that shows the price of an asset is weakening. It happens when a short-term moving average crosses below a long-term moving average. This crossover signals that momentum has shifted, and traders who were previously optimistic may now have a bearish outlook.

Displaced Moving Average (DMA)

Displaced Moving Average (DMA) is a type of moving average that shifts a simple or exponential moving average (SMA or EMA) forward or backwards in time by a specified number of periods.

Doji Candlestick Pattern

A Doji candlestick pattern is a type of candlestick that represents market indecision. It forms when a security’s opening and closing prices are nearly equal, resulting in a candle with a very small or non-existent body and long or short wicks (shadows) on either side.

Donchian Channels

Donchian Channels are a trend-following technical indicator that plots the highest high and lowest low over a specified time period. They are typically used to identify price breakouts, volatility, and support/resistance levels.

Dow Theory

Dow Theory is one of the oldest and most foundational theories in technical analysis, developed from the writings of Charles H. Dow (co-founder of the Wall Street Journal and Dow Jones & Company) in the late 19th and early 20th centuries.

Downward Sloping Trendline

A downward sloping trendline is a straight line drawn on a price chart that connects two or more lower highs. It visually represents a downtrend, indicating that the asset’s price is generally moving lower over time.

Elliott Wave Theory

Elliott Wave Theory is a tool in technical analysis developed by Ralph Nelson Elliott in the 1930s. It suggests that market prices don't move randomly but follow a repeating pattern driven by investor psychology.

Evening Star Pattern

The Evening Star is a bearish reversal candlestick pattern that typically appears at the top of an uptrend. It signals that the bullish momentum may be weakening, and a potential downtrend could begin.