Master the market jargon. Learn technical terms, strategies, and concepts by experiencing them in a risk-free environment.
Short selling is an investment or trading strategy that speculates on the decline in a stock or other security's price. It is an advanced strategy that should only be undertaken by experienced traders and investors.
Leverage involves using borrowed capital for (an investment), expecting the profits made to be greater than the interest payable. In crypto trading, leverage allows you to control a larger position with a smaller amount of capital.
An order book is an electronic list of buy and sell orders for a specific security or financial instrument organized by price level. It shows the depth of the market and reflects the demand and supply for the asset.
A blockchain is a decentralized, distributed and public digital ledger that is used to record transactions across many computers so that the record cannot be altered retroactively without the alteration of all subsequent blocks and the consensus of the network.
A cryptocurrency wallet is a device, physical medium, program or a service which stores the public and/or private keys for cryptocurrency transactions. In addition to this basic function of storing the keys, a cryptocurrency wallet more often also offers the functionality of encrypting and/or signing information.
A bull market is the condition of a financial market in which prices are rising or are expected to rise. The term 'bull market' is most often used to refer to the stock market but can be applied to anything that is traded, such as bonds, real estate, currencies, and commodities.
A bear market is when a market experiences prolonged price declines. It typically describes a condition in which securities prices fall 20% or more from recent highs amid widespread pessimism and negative investor sentiment.
FUD is a disinformation strategy used to influence perception by spreading negative, misleading or false information about a business or a product. In crypto, it refers to spreading fear to lower the price of a coin.
FOMO describes the anxiety that an exciting or interesting event may currently be happening elsewhere, often aroused by posts seen on a social media website. In trading, it leads to impulsive buying when prices are already high.
HODL is a term derived from a misspelling of 'hold' that refers to buy-and-hold strategies in the context of bitcoin and other cryptocurrencies. It is also popularly interpreted as an acronym for 'Hold On for Dear Life'.
The liquidation price is the point at which an exchange automatically closes a trader's leveraged position due to the loss of all initial margin. This happens to prevent the trader from falling into debt beyond their initial deposit.
A stop-loss order is an order placed with a broker to buy or sell a specific stock once the stock reaches a certain price. It is designed to limit an investor's loss on a position in a security.
A take-profit order is a standing order to sell a security once it reaches a certain level of profit. Setting a take-profit order enables the trader to maximize their profit by exiting a trade as soon as the market presents a favorable price.
Market capitalization (market cap) is the total value of all the coins that have been mined. It is calculated by multiplying the current market price of a single coin by the total number of coins in circulation.
Trading volume refers to the total number of shares or contracts exchanged between buyers and sellers of a security during trading hours of a given day. High volume indicates high interest and liquidity.
A crypto whale is an individual or entity that owns a large amount of a cryptocurrency. Whales have enough funds to manipulate the valuation of a specific crypto currency.
Altcoin is a combination of the two words 'alternative' and 'coin' and includes all cryptocurrencies other than Bitcoin. Successes of Bitcoin as the first framework for digital currency paved the way for others to follow.
Stablecoins are cryptocurrencies where the price is designed to be pegged to a cryptocurrency, fiat money (like USD), or to exchange-traded commodities. USDT and USDC are prime examples.
Gas fees are payments made by users to compensate for the computing energy required to process and validate transactions on the Ethereum blockchain. High network congestion leads to higher gas fees.
Rekt is a slang term derived from 'wrecked', used to describe a trader who has lost a substantial amount of money due to a bad trade or liquidation.
Diamond hands describes an investor who refuses to sell their cryptocurrency despite significant price drops or volatility. It signifies extreme conviction in a long-term position.
Paper hands refers to an investor who sells their assets at the first sign of trouble or volatility. They lack conviction and are easily shaken out of their positions.
ROI measures the gain or loss generated on an investment relative to the amount of money invested. It is usually expressed as a percentage.
ATH stands for 'All-Time High', representing the highest price point that a cryptocurrency has ever reached in its history.
ATL stands for 'All-Time Low', representing the lowest price point that a cryptocurrency has ever reached in its history.
A scheme where the price of a crypto asset is artificially inflated (pumped) through orchestrated buying and misleading marketing, followed by a rapid sell-off (dump) by the perpetrators, leaving late buyers with losses.
Technical analysis involves forecasting future financial price movements based on an examination of past price movements. Like weather forecasting, technical analysis does not result in absolute predictions.
Fundamental analysis is a method of evaluating an asset's value by looking at economic and financial factors. In crypto, this includes the team, whitepaper, use case, and community.
The Relative Strength Index (RSI) is a momentum indicator used in technical analysis that measures the magnitude of recent price changes to evaluate overbought or oversold conditions.
MACD (Moving Average Convergence Divergence) is a trend-following momentum indicator that shows the relationship between two moving averages of a security's price.
A moving average is a stock indicator that is commonly used in technical analysis. The reason for calculating the moving average of a stock is to help smooth out the price data by creating a constantly updated average price.
A candlestick chart is a style of financial chart used to describe price movements of a security, derivative, or currency. Each 'candle' provides four points of information: open, close, high, and low prices.
Support is a price level where a downtrend tends to pause due to a concentration of demand (buying interest). Resistance is a level where an uptrend is expected to pause temporarily, due to a concentration of supply (selling interest).
KYC stands for 'Know Your Customer'. It is a mandatory process of identifying and verifying the identity of the client when opening an account and periodically over time.
PnL stands for 'Profit and Loss'. It refers to the total amount of profit or loss made from a trade or investment portfolio over a certain period. Unrealized PnL is paper profit, Realized PnL is cashed out.
The spread is the gap between the highest price a buyer is willing to pay (bid) and the lowest price a seller is willing to accept (ask). Low liquidity coins often have high spreads.
Slippage refers to the difference between the expected price of a trade and the price at which the trade is executed. It happens most often during periods of higher volatility.
Mining is the process that Bitcoin and several other cryptocurrencies use to generate new coins and verify new transactions. It involves vast networks of computers around the world that verify and secure blockchains.
Staking offers crypto holders a way to put their digital assets to work and earn passive income without selling them. It involves locking up funds to support the operations of a blockchain (PoS).
DeFi is an emerging financial technology based on secure distributed ledgers similar to those used by cryptocurrencies. It removes the control banks and institutions have on money, financial products, and financial services.
A decentralized exchange (DEX) is a peer-to-peer marketplace where transactions occur directly between crypto traders. DEXs fulfill one of crypto's core possibilities: fostering financial transactions that aren't officiated by banks or brokers.
Centralized exchanges (CEXs) are organizations that coordinate cryptocurrency trading on a large scale, using a similar business model to traditional asset exchanges like stock markets. Binance and CoinArena are examples.
A seed phrase is a series of words generated by your cryptocurrency wallet that give you access to the crypto associated with that wallet. If you lose your seed phrase, you lose your crypto forever.
A cold wallet is a cryptocurrency wallet that is not connected to the internet. This makes it immune to online hacking attempts, providing the highest level of security for stored assets.
An NFT is a unique digital identifier that cannot be copied, substituted, or subdivided, that is recorded in a blockchain, and that is used to certify authenticity and ownership.
Bitcoin halving is an event where the reward for mining new blocks is halved, meaning miners receive 50% fewer bitcoins for verifying transactions. This occurs roughly every four years.
A whitepaper is a document released by a crypto project that gives technical information about its concept, and a roadmap for how it plans to grow and succeed.
An airdrop is a distribution of a cryptocurrency token or coin, usually for free, to numerous wallet addresses. Airdrops are primarily implemented as a way of gaining attention and new followers.
WAGMI stands for 'We All Gonna Make It', representing optimism. NGMI stands for 'Not Gonna Make It', used when someone makes a bad trade or holds a dying coin.
A rug pull is a malicious maneuver in the cryptocurrency industry where crypto developers abandon a project and run away with investors' funds.
DYOR encourages investors to complete their own due diligence into a project before investing, rather than relying on the advice of others.