Trend The general direction of an asset's price movement in the market over a certain period. Trends can be:
- Uptrend: A consecutive increase in lows and highs, with the market moving upward.
- Downtrend: A consecutive decrease in highs and lows, with the market moving downward.
- Sideways Trend (Flat): The price moves in a narrow range without a clear direction.
Tendency A long-term price movement direction covering an extended period. Tendencies can be long-term (months or years), medium-term (weeks or months), and short-term (days or weeks).
Resistance A price level where the asset encounters strong selling pressure, preventing further price growth. This is a psychological barrier often used by traders to take profits.
Support A price level where the asset receives strong buying pressure, preventing further price decline. This is the area where demand for the asset starts to exceed supply, supporting the price.
Channel The price range in which the asset moves between support and resistance levels. Channels can be upward, downward, or horizontal.
Volatility A measure of an asset's price variability over a certain period. High volatility indicates significant price fluctuations, making the market riskier but also offering more profit opportunities.
Momentum The speed of an asset's price change. Momentum indicators like MACD and RSI help assess the trend's strength and predict its possible continuation or weakening.
Breakout A situation where the asset price breaks through a support or resistance level, often accompanied by an increase in volume and volatility. A breakout can signal the start of a new trend.
Flat A situation where the asset price moves sideways without a clear upward or downward trend. During this period, the market consolidates, and the price fluctuates in a narrow range.
Volume The total number of shares or cryptocurrencies that have been bought and sold over a certain period. Volume helps assess the significance of price movements and confirms trend strength.
Retest When the price returns to a previously broken support or resistance level to confirm it as a new resistance or support level. Retests are often used to confirm breakouts and are an important element of trading strategies.
Overbought A market condition when the asset price has risen too high and fast, which may signal a possible downward correction. Typically identified when the RSI exceeds 70.
Oversold A market condition when the asset price has fallen too low and fast, indicating a possible upward reversal. Typically identified when the RSI drops below 30.
Divergence The divergence between price movement and an oscillator, indicating a possible weakening of the current trend and a likelihood of reversal. Divergences can be:
- Bullish Divergence: The price forms new lows, but the oscillator forms higher lows.
- Bearish Divergence: The price forms new highs, but the oscillator forms lower highs.
Convergence The convergence of price and an oscillator, confirming the strength of the current trend. If the price and the indicator move in the same direction, this signals trend continuation.