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Hey, Traders, it’s Marina, the trader chick, and today we’re going to be talking about is day trading lingo. You know, sometimes when you’re just starting out or even if you’ve already been doing it for a while, the words sometimes just simply don’t make sense. Right. Like, if I was to enter the Formula One driving world, probably half of the stuff that they say there, I wouldn’t understand. And it’s the same when it comes to trading and financial markets in general.
Sometimes when you hear words that you just, it makes no sense. So today I’m going to simplify it and you are going to be talking like a pro. Are you ready? Let’s go. I’m Marina, the trader chick. And if you have not subscribed to our YouTube channel, do so below, because I’ve got lots of goodies coming to you every single week. We simplified trading entirely and make it accessible to everybody. All right, let’s dig in day trading lingo.
All right, guys, are you ready because the trader chick is going to simplify your day trading today, we are talking about the trading lingo. Have you ever been in a place where it’s something foreign to you, and you simply don’t know what people are talking about? I mean, it depends on the industry you’re in, right? If you enter a Formula One driving world, you probably won’t understand half of the stuff they say if you enter the medical world.I definitely don’t get anything they say, but I sometimes feel the same when it comes to day trading and the financial markets altogether. So instead of feeling completely out of your realm and that’s what kind of keeps you from starting today.
I’m going to simplify it, and you will be talking like a pro. Let’s begin.
OK, intraday day trading. What is that? Honestly, this is it’s exactly what it means intraday. You are in and out of all of your positions within the same day, meaning you do not hold anything at all overnight.
So everything you’re in, you close your positions. Otherwise, that becomes a completely different kind of trading. And we’re going to talk about intraday right now.
Bull markets. I’m sure you’ve heard of that before, right? What is a bull market? It’s literally just a market going up. Just a raging bull going up. That’s it. Market going up. A market trending up. That’s what a bull market is
A bear market, the exact same thing. But going down, the market is going down. Super simple. Market is going down. Market is trending down. All right, so there are technically three trends in the market, it doesn’t matter which market you are looking at, and it doesn’t even matter which if your day trading or long term trading or long term investing, it’s all the same. You even are going to have an upward trend, a bull market, a downward trend, a bear market or a flat sideways trend.
We could call the sideways, trying to channeling market or an exhaustion pattern, but it’s usually flat. So there are three trends that we should really understand. Next, these are really important to understand.
Recommended Read: Bull Bear Trading
Profit target. What does that even mean? So when you enter a trade, you really need to have a profit in place. You can’t just go in and leave it there. Right. That’s more long-term investing. We are talking here about trading days trading.
So you need to set a profit target when you are going to exit the trade with a profit. But at the same time, you also need to have risk management in place. You could also understand it, maybe as a stop loss. What that means is when you enter a trade, you always need to have a risk in place. It depends on what your strategy is, but you have to have it there. This way, you don’t end up losing all of your money.
And trust me, we could do that because a lot of people put in mental risk management’s mental stop losses. Those do not work. You need to have defined risk management in place, OK, you need to have that there. So whenever you hear people say, what’s your risk management, or do you have a stop loss in place, now you understand what that means is where what is the most you are willing to lose on that particular trade chart for day traders.
You cannot survive without a chart. It’s literally like a Formula One driver. But they don’t ever get a car. They’re in a minivan or in, you know, a little tiny car that you just drive around town, and you need to have the right software, the right vehicle for your trading for day traders. We need to work with good, strong charting software. I personally recommend having charting software that is on your desktop. I have a video that you could watch to make sure that you sign up, and the video is going to be below as well.
So make sure that you check out that video. But everyday traders need to have specific charts, charting platforms.
Recommended Read: day trading charting
Indicators, all the charting software they come with universal indicators. That is part of their software. That is part of what they offer. I do not recommend buying indicator software as algorithms, but none of that. Again, I have another video that you could check out. Make sure you are subscribed because there are tons of really powerful videos that will help you understand this so much better.
So remember, Indicators, are included in your software, and you as a trader, need to have certain indicators that you work with that you understand that will really help you move along.
Trending markets, as I mentioned before, there are only three trending markets going up, going down, or going sideways. Right. The bull market, the bear market, or the channeling market. OK, now let’s talk about entering the markets because we, day traders go up or down.
We could enter either an upward trend or a downward trend. But to understand what that means, these are the terminologies that are used.
Recommended Read: Trends in Trading
We are buying or you are going long. What does that mean? It means you are entering the market at a lower price point and you’re exiting the market at a higher price point and you taking the profit in between. OK, so that is really important for you guys to understand. It’s going you’re buying. You’re going long.
All right. So the opposite of that is selling or going short. This is on a downward trend. When the market is going down, it’s trending down. What does that mean when people say I’m going short, or I’m selling? What does that mean? It means you are entering the position at a higher price point, and you’re exiting at a lower price point, and you’re taking the in-between profit. OK, this is really important for day traders, guys.
Market entry’s market entries are crucial when you are day-trading. What you were going for is a specific price point. If your go is in a market, that means you’re entering whatever is right in front of you. That works really well if you’re going for a longer-term because you don’t really care right away. So what we do is day traders we need to put in. Limit order or an order waiting. What that means is you are telling the market exactly where you want to enter.
That is called limit order or order waiting because the market goes in right away. And when you go in market, when you press market entry, that is telling the market that you don’t really care if you lose a little bit what that loss is. It’s called slippage. I don’t want to get too complicated into it. However, for day trading, we need to understand that you are telling the market where you are entering the market, not just where it is at the moment.
You have a set price in mind. So you will use your software to put that in. And that is all part of your charting software. Again, the same goes with a stop limit. You do not want to exit at a market exit. What that means is when you’re just pressing market to get out of a trade, you are going to lose a little bit of money because we’re going for a certain amount of money in a day’s trade.
It’s a lot less than if you would go for a longer one. You need to set your stop limit. And what is that? That’s that risk management. That is that stop loss. All right.
Technical analysis, you will hear people talking about technical analysis when it comes to trading. Basically, it is literally reading what the chart is telling you. There are that’s when you use your indicators as to when you have a strategy that is understanding within terms of going down, ranging sideways upward trend.
This is technical analysis when you are watching your charts to understand what is going on, which includes having areas, divergences, reversal areas. These are the super basics of what technical analysis is all about. I’m going to go into right now a little bit more detailed understanding areas.
Related Read: technical analysis futures markets
Areas are super important because the market will revisit those areas again and again, and you need to have them drawn out and really understood what they are all about. OK, the two main areas are resistance and support.
I have videos for both of these areas really in-depth, so you could really understand. So go down and make sure that you are looking at them all at the videos below and also subscribe because I’m constantly doing new ones. All right, let’s jump into the resistance area. You are going to be hearing people talk about resistance. A lot of times all it literally means is the ceiling of the market. It’s where the trend is going to hit the market over and over again several times or more going upward.
It’s a ceiling. That’s all it is. That’s all you really need to understand. Nothing else. But you do need to be able to draw that in support area is the exact opposite is the floor of the market. It’s where the market is bouncing off the floor three or four more times so that you have that support area. A lot of times these areas could either transition the trend altogether or it could break through and continue on. But in the meantime, you have to understand when you hear people say, oh, there’s a resistance forming or there’s a support area.
So now you understand resistance area is the ceiling, support is the floor. All right.
Reversal patterns you’ll be hearing people talk about, oh, there’s a reversal pattern coming up. I’m seeing a reversal. Reversals are really, really simple to understand. And once you get it and once you start trading, this could revolutionize your trading altogether. And again, I have videos for all of these different aspects and really got into them before this particular video. We just want to understand a quick understanding of it.
Reversal patterns. It’s when you can have a double top when your pivots are doing like an M or a triple top or double bottom, double or triple bottom. Or you could also head to heaven shoulders as well, meaning you have a shoulder hit in the shoulders coming through, and you’ll hear people say, oh, there’s divergence forming basically is when you have two different indicators. Well, you have an indicator that works alongside your price action. The price action is when you see these bars and the indicator could be going in the opposite direction.
So if one area, if your trend is going up and your indicator is going down, that’s a divergence or vice versa. Your trend is going down, and your indicator below is going up. That’s the divergence is literally when your indicators are diverging, that’s all it means.
Again, guys, this was super quick for you to get the super basics. This is literally what you’ll be hearing, the majority of people talking. But now, you know, now you’ll be able to totally understand what is happening.
And if you don’t, you could always email me at thetraderchick@Gmail.com. And again, subscribe to my YouTube channel for a lot more videos like this.
