Definitions

Ask/Offer: The lowest price a seller is willing to accept for a stock.

Bear Market: A market characterized by falling stock prices, often defined as a decline of 20% or more from recent highs.

Bearish Patterns: Suggest potential downward price movement or a reversal of an uptrend.

Bid: The highest price a buyer is willing to pay for a stock.

Bid-Ask Spread: The difference between the bid and ask prices.

Bond: A debt security where an investor loans money to a company or government for a set period, receiving interest payments.

Brokerage Account: is an investment account with a licensed financial institution (a brokerage firm) that allows you to buy and sell various investments, such as stocks, bonds, ETFs, and mutual funds.

Bull Market: A market where stock prices are generally rising, or are expected to rise.

Bullish Patterns: Indicate potential upward price movement or a reversal of a downtrend.

Candles:

Body: The rectangular section of a candle representing the range between the opening and closing prices. A long body suggests strong buying or selling pressure, while a short body indicates indecision. (ask about this last part, and I will explain)
Wick: Lines extending from the body that show the highest and lowest prices reached during the period.
Colors: Typically green or white for a bullish (upward) candle, and red or black for a bearish (downward) candle.
1. Green: For a bullish (upward) candle.
2. Red: For a bearish (downward) candle.

Candlestick patterns: These patterns, which can range from a single candle to a group of candles, represent a specific period's open, high, low, and closing prices and are categorized as bullish, bearish, or continuation patterns, signaling potential trend reversals or continuations.

Capital gains: refer to the profit earned after selling an asset or investment for a higher price than you paid for it.

Capital Gains Tax: Tax on gains (profits) you make from the sale of capital assets, like stocks and other investments. Under U.S. tax laws, if you hold an investment for more than a year before you sell it for a gain, you may qualify for a long-term capital gains tax rate. Gains from investments held for less than a year are usually considered short-term capital gains and are taxed as ordinary income (which is usually a higher tax rate than long-term capital gains).

Continuation Patterns: Signal that the existing trend is likely to continue.

Derivatives: Options are called derivatives because their value is derived from the value of the underlying stock.

Dividend: A portion of a company's profits that is paid out to its shareholders.

ETF (Exchange-Traded Fund): Similar to a mutual fund, but traded on stock exchanges like an individual stock.

Exchange: or stock exchange, is a marketplace where investors and traders buy and sell stocks. New York Stock Exchange (NYSE), Nasdaq, Shanghai Stock Exchange, Tokyo Stock Exchange, Hong Kong Stock Exchange, London Stock Exchange, Australian Securities Exchange, and SIX Swiss Exchange.

Expiration Date: The contract has a limited lifespan, after which it becomes worthless if not exercised.

Equity: Another term for stocks, representing ownership in a company.

Futures: are a type of derivative contract agreement to buy or sell a specific commodity asset or security at a set future date for a set price.

Going Long: Buying a stock with the expectation that its price will rise.

Going Short: Borrowing shares, selling them, and then buying them back later to return to the lender, profiting from a price decrease.

IPO (Initial Public Offering): The first time a private company sells shares of its stock to the public.

Limit Order: An order to buy or sell a stock only at a specified price or better.

Liquidity: The ease with which a security can be bought or sold in the market without significantly affecting its price.

Margin: Sometimes referred to as “buying on margin,” margin is when investors borrow money from a broker to purchase a stock, similar to a loan.

Market Capitalization: The total market value of a company's outstanding shares.

Market Order: An order to buy or sell a stock immediately at the best available current price.

Mutual Fund: A collection of stocks, bonds, or other securities that is professionally managed.

Options: Call Options: A call option gives the buyer the right to buy stock. Investors buy calls when they believe the stock price will go up. Put Options: A put option gives the buyer the right to sell stock. Investors buy puts when they expect the stock price to fall.

Pip: A pip, or "percentage in point," is the standard unit for measuring the change in price between two currencies in the Forex market. For most currency pairs, one pip is the fourth decimal place (\(0.0001\)), but for pairs involving the Japanese Yen (JPY), it's the second decimal place (\(0.01\)). Pips are crucial for traders to calculate profits and losses, manage risk, and set stop-loss and take-profit levels.

Resistance: is the price level at which selling is thought to be strong enough to prevent the price from rising further.

Right, Not Obligation: The most important aspect is that the option gives the buyer the option to buy or sell, not a requirement to do so.

Stop-Loss Order: An order to sell a stock when it reaches a certain price to limit potential losses.

Stock/Share: A unit of ownership in a publicly traded company.

Support: is the price level at which demand is thought to be strong enough to prevent the price from declining further.

Strike Price: This is the fixed price at which the stock can be bought or sold if the option is exercised.

Taxes: You pay taxes on any dividends, interest, or capital gains earned within the account.

Underlying Asset: The stock or exchange-traded fund (ETF) on which the option contract is based.

Volatility: The degree of variation in a stock's price over a given period; high volatility means rapid and unpredictable price swings.