Market words, in simple language
Early phase of an uptrend when informed buyers quietly buy.
The price a seller wants. Also called offer.
Popular name for the Nifty Bank index of banking stocks.
The price a buyer is willing to pay.
Your 16-digit demat account number (Beneficial Owner ID).
The thick part of a candle, between open and close.
Bands two standard deviations above and below a 20-period average, showing volatility.
Break of Structure – price breaks its last swing extreme in the trend direction; trend continues.
Price moving beyond support or resistance and holding there.
A SEBI-registered member of the exchange through whom you place orders.
Formerly Bombay Stock Exchange. Founded 1875, Asia’s oldest stock exchange.
Buy Today, Sell Tomorrow – selling shares before they reach your demat.
A chart symbol showing OHLC with a body and wicks. Green = closed up, red = closed down.
Consolidated Account Statement – monthly statement from NSDL/CDSL showing all your holdings.
Change of Character – price breaks the last swing that defended the trend; possible reversal.
The maximum a stock is allowed to move up or down in a day. Also called price band.
The body that settles trades and guarantees that buyers get shares and sellers get money.
Several reasons pointing to the same price zone, making it more important.
Trend, location and recent story that give meaning to a signal.
The official bill for your trades, sent by your broker on the trade day.
A short moving average crossing below a long one.
Buying shares to take them into your demat and hold them.
Account that holds your shares in electronic form.
Example: Like a locker for your shares.
An organisation that holds securities electronically. India has NSDL and CDSL.
The agent (usually your broker) through which you hold a demat account with a depository.
Late phase of an uptrend when informed sellers quietly sell to late buyers.
When price and an indicator move in different directions, a sign of weakening momentum.
A part of the company’s profit paid to shareholders.
Example: ₹5 dividend per share on 100 shares = ₹500.
A candle where open and close are almost equal – indecision.
Two failed attempts at the same high, then a break of the neckline – a bearish reversal.
Charles Dow’s ideas on trends, phases and confirmation – the base of technical analysis.
Price making lower highs and lower lows.
A situation where results are in your favour over many repetitions.
Exponential Moving Average – gives more weight to recent prices.
A candle whose body fully covers the previous candle’s body, showing a takeover.
Three-candle top pattern: big green, small candle, big red.
Average result per trade = win rate × average win − loss rate × average loss.
Futures and Options – derivative contracts whose value depends on an underlying stock or index.
A breakout that quickly fails and comes back inside the range. A trap.
Levels (23.6%, 38.2%, 50%, 61.8%) used to estimate how deep a pullback may go.
A small, tidy pause after a sharp move, usually followed by continuation.
Shares available for the public to trade, excluding those held by promoters and similar holders.
Studying a business – sales, profits, debt, management – to judge its value.
A short moving average crossing above a long one, like 50-day above 200-day.
After a fall, a small body near the top with a long lower wick – rejection of lower prices.
Same shape as a hammer but after a rise – a warning of selling pressure.
Three peaks with the middle one highest; a close below the neckline completes it.
Higher High, Higher Low, Lower High, Lower Low – labels for swings.
A strong, fast move in one direction with big candles.
A number that tracks a group of stocks to show how the market or a sector is doing.
The rise in prices over time, which reduces what your money can buy.
Example: A vada pav that cost ₹10 years ago now costs ₹20.
A candle whose range is fully inside the previous candle’s range – a pause.
Buying and selling the same share on the same day.
A SEBI-registered person or firm allowed to give personal investment advice for a fee.
Initial Public Offering – when a company sells shares to the public for the first time.
Among the top 100 companies by market cap. Usually more stable.
Controlling a big position with a small amount of money. Increases both profit and loss.
Order to buy or sell only at a set price or better.
How easily something can be bought or sold without moving the price much. Also: orders waiting to be filled.
When a company’s shares start trading on a stock exchange after the IPO.
Moving Average Convergence Divergence – momentum indicator built from 12 and 26 EMAs with a 9-period signal line.
Total market value of a company = number of shares × share price.
Order to buy or sell immediately at the best available price.
The sequence of swing highs and lows that shows who is in control.
A candle with a big body and almost no wicks – strong control by one side.
Companies ranked 101 to 250 by market cap.
The speed of a price move.
Three-candle bottom pattern: big red, small candle, big green.
Average price over a set number of periods, updated each period to smooth noise.
The support (or resistance) line that confirms a reversal pattern when broken.
NSE’s main index of 50 large companies.
National Stock Exchange of India. Started screen-based trading across India in 1994.
Open, High, Low, Close – the four prices of each period on a chart.
The list of all waiting buy orders (bids) and sell orders (asks) for a security.
Price has risen fast; RSI typically above 70. Not a sell signal by itself.
Price has fallen fast; RSI typically below 30. Not a buy signal by itself.
Practising trades on paper or a simulator without real money.
Deciding how many shares to buy based on how much you are willing to lose.
A short session before normal trading where the opening price is found through an auction.
Reading the chart from price itself – candles, swings and levels – without depending on indicators.
Where new shares are issued by the company, like in an IPO.
A slower move against the trend, usually with smaller, overlapping candles.
Price moving sideways between a floor (support) and a ceiling (resistance).
A SEBI-registered person or firm allowed to publish research and recommendations.
A price zone where sellers have stopped rises before.
Price returning to a broken level to test it from the other side.
How much you may gain compared to how much you may lose on a trade.
Example: Risk ₹10, target ₹20 = 1:2.
When broken resistance becomes support, or broken support becomes resistance.
Relative Strength Index – momentum indicator from 0 to 100, created by J. Welles Wilder.
SEBI’s online system to file complaints against market entities.
Securities and Exchange Board of India – the market regulator.
Where investors buy and sell existing shares with each other on the exchange.
BSE’s main index of 30 large companies.
The actual exchange of money and shares after a trade.
A small unit of ownership in a company.
Example: Owning 100 shares of a company with 1 crore shares = owning 0.001% of it.
A person who owns shares of a company.
After a rise, a small body near the bottom with a long upper wick – rejection of higher prices.
Simple Moving Average – plain average of the last N closes.
Companies ranked beyond 250 by market cap. Can move very fast in both directions.
The gap between the best ask and the best bid.
When Bollinger Bands get very narrow – low volatility that often comes before a big move.
A quick move just beyond an obvious level that triggers stop-losses and then reverses.
A planned exit that limits your loss if price moves against you.
A price zone where buyers have stopped falls before.
A peak with lower highs on both sides.
A valley with higher lows on both sides.
Settlement on the next working day after the trade day.
Example: Buy on Monday, shares in demat on Tuesday.
Studying price and volume charts to judge buyers and sellers and time trades.
The period each candle represents, like 5 minutes, 1 day or 1 week.
Account with your broker used to place buy and sell orders.
A record of every trade – reason, entry, stop, target, result and lessons.
A stop-loss you move in the direction of profit as the trade progresses.
The general direction of price over a period – up, down or sideways.
A line joining lows in an uptrend or highs in a downtrend.
Price swings narrowing into a point, ending in a breakout.
The price at which a stop-loss order becomes active.
Price making higher highs and higher lows.
How much and how fast price moves up and down.
Number of shares traded in a period – shows participation.
The thin lines above and below a candle body, showing high and low. Also called shadow.