Trading Terms & Definitions

A contract that gives you the right to buy a stock at a set price before a certain date. Used when expecting a stock to rise.

A contract that gives you the right to sell a stock at a set price. Typically used when you expect the stock to fall.

When price breaks above resistance or below support with strong volume or momentum, potentially starting a new trend.

Support is a price level where buying tends to step in. Resistance is where selling tends to occur. Key levels in every chart setup.

A short-term trade meant to capture a small move — typically held for minutes to under an hour.

A trade held for days to weeks to capture a bigger directional move. Often based on daily or 4-hour charts.

A rapid drop in implied volatility, usually after earnings or big events — causing options to lose value even if price moves in your favor.

A way to measure how much you're risking versus how much you aim to make. Good traders aim for 2:1 or better setups.

A stop-loss that adjusts upward as the trade moves in your favor — helping lock in profits while allowing continuation.

Futures contracts like NQ (Nasdaq-100) and ES (S&P 500) are leveraged products that track major indexes. Common in JR28 alerts for intraday and swing setups.