Glossary
Terms, defined plainly
- BidMarkets
- The highest price a buyer is currently willing to pay. You sell at the bid.
- Lesson: Exchanges, brokers, and the order book
- CandlestickTechnicals
- A bar showing open, high, low and close for one period; the body and wicks reveal who won the session.
- Lesson: Reading candlesticks
- Dealing rangeSMC
- A chosen swing low-to-high range used to define premium, discount and equilibrium.
- Lesson: Premium, discount and the dealing range
- DivergenceTechnicals
- Price and an indicator disagreeing, such as a higher price high with a lower RSI high.
- Lesson: RSI and momentum
- Equal highs / equal lowsSMC
- Two or more swings within a small tolerance of each other; treated as an obvious liquidity pool.
- Lesson: Liquidity pools, equal highs/lows and sweeps
- Fair value gap (FVG)SMC
- A three-candle imbalance: candle 3's low above candle 1's high (bullish) or the mirror (bearish).
- Lesson: Displacement and fair value gaps
- LiquidityMarkets
- How much you can trade without moving the price. Deep books and tight spreads mean high liquidity.
- Lesson: Exchanges, brokers, and the order book
- Liquidity poolSMC
- A price area where resting stop and breakout orders are presumed to cluster, such as above obvious highs or below obvious lows.
- Lesson: Liquidity pools, equal highs/lows and sweeps
- Swing highSMC
- A candle whose high exceeds the highs of N candles either side; only confirmed N candles later.
- Lesson: Market structure and swing points
- UptrendTechnicals
- A sequence of higher swing highs and higher swing lows.
- Lesson: Trend structure and volume confirmation