Your Go-To Trading Dictionary: The 2025 Edition

Whether you interpret price charts or read through market commentary, fluency in key terms is essential for new traders as it enables them to build a robust foundation of knowledge for sustained success in trading. Octa broker presents this 2025-ready glossary that unites classic concepts and trending terms for today’s markets.

H2: Foundational Concepts

Ask / Bid PriceThe ask price is the lowest price a seller will accept; the bid price is the highest price a buyer is willing to pay. If you buy a financial instrument (for example, a forex pair), you buy it at an ask price (and pay it to the seller). If you then decide to sell it, you sell it at a bid price, which is paid by the buyer. 

SpreadA spread is the difference between the ask and bid price. A deep and liquid market (for example, EURUSD) would usually have a narrow, or ‘tight’, spread. Conversely, markets with fewer sellers and buyers would normally have a relatively wide, or  ‘loose,’ spread. 

PipA pip measures a small movement in exchange rates, usually 0.0001. Example: a move from 1.2040 to 1.2045 is five pips.

LeverageLeverage lets traders control big positions with less capital. Depending on the broker’s rules, leverage can multiply gains as well as losses.Example: With 1:100 leverage, an account with £1,000 would be able to control a position worth  £100,000.

Long / Short PositionGoing long means buying an asset, anticipating that its price will rise. Going short means selling an asset, anticipating that its price will fall.

Lot SizeForex trades use standardised units called lots. One standard lot equals 100,000 units of currency. There are also mini lots and micro lots.

Stop-Loss / Take-ProfitThese normally refer to pending orders on open positions to automatically close them at pre-set levels. This is vital for risk control.

CFD (Contract for Difference)A CFD is a financial instrument that lets traders speculate on the price moves of an asset without actually owning it. 

Bullish / BearishRefer to investors' and/or traders’ expectations. ‘Bullish’ describes positive market outlook and expectations for higher prices, while ‘bearish’ indicates a negative perception and anticipation for lower prices. 

H2: Technical Terms

Support / ResistanceA support level is where a lot of buyers are expected to enter the market, thus supporting the price and preventing it from falling further. Likewise, a resistance level is where sellers are anticipated, preventing the price from rising higher.

Trend / TrendlineA trend shows overall price direction. The trend is bullish if an asset’s price is rising, with each consecutive peak and trough higher than the previous one. A trend is bearish if the price is falling and each successive peak and trough is lower than the previous one. A trend can also be sideways or range-bound when the price is moving within a specific trading range. Traders would normally draw trendlines to identify a trend. 

Moving Average (MA)A moving average calculates the average price of an asset over a specific timeframe, usually measured in candles.Example: A 50-day MA calculates the average price over the last 50 trading sessions.

Candles (Candlesticks)

Visual representations of price movements over a specific timeframe. Each candle shows the opening, closing, high, and low prices within that period, helping traders interpret market sentiment at a glance.

Timeframe

Refers to the length of time each candlestick or bar represents on a chart. It defines how much market data is condensed into a single price unit. 

Example: On a 1-hour timeframe, each candlestick shows the price movement during one hour of trading.

VolatilityMeasures the extent and the speed of price moves. More volatility usually means higher risk and greater potential reward.

BreakoutA breakout happens when price smashes through support or resistance, often precipitating a new trend in the direction of a breakout.

VolumeThe number of contracts, shares, or lots traded during a specific timeframe. Surging volume usually confirms strong moves.

H2: Market-Related Vocabulary

LiquidityHow easily something can be bought or sold. High liquidity equals faster execution and tighter spreads.

SlippageWhen a trade fills at a worse price than expected or planned. This is common during high-impact events, when the price moves very fast and ‘slips through’ the desired price.

Correction / Reversal / Retracement / PullbackAll describe a pause or change in trend. Often used interchangeably, though with subtle differences.

ConsolidationA phase of sideways movement—markets catch their breath before choosing direction.Example: Gold consolidated in August-November 2022, before turning bullish in Q1 2023.

H2: Trading Slang / Jargon

FOMOStands for ‘fear of missing out'—a common feeling of anxiety stemming from the fear of missing out on pleasant or rewarding experiences. In trading, FOMO frequently refers to a trader's apprehension about not participating in a significant upward or downward price movement, thereby missing potential gains. 

HODLBorn from a typo, now gospel in crypto circles. Means “hold on through the chaos.”

Pump and DumpAn asset’s price is deliberately pushed up, only to be quickly sold off for profit—often seen in new, thinly traded cryptocurrencies. 

WhipsawRapid price reversals that hurt both buyers and sellers, making it difficult to spot a sustainable trend

BagholderStuck holding a crashing asset, hoping for a comeback.

RektTrader-speak for taking a major loss.

Dead Cat BounceA brief recovery during a strong downtrend—often misleading.

H2: Trending Terms in 2025

DePIN (Decentralised Physical Infrastructure Network)A blockchain-based system that manages real-world infrastructure—such as wireless networks, sensors, or energy grids—by allowing users to contribute hardware and earn rewards for supporting the network.

AI Agent TradingAI bots that trade autonomously based on market signals, news, and historical data.

Gas FeesFees paid to process blockchain transactions—can spike during congestion, especially on Ethereum.

Learning these terms is just the beginning of facilitating market understanding. The more fluent traders are in the language of the markets, the quicker they adapt. For those just starting out, it’s advised to study educational resources and webinars from market experts—similar to those offered by global brokers like Octa. In markets that never sleep, knowledge really is power.

Disclaimer: Trading involves risks and may not be suitable for all investors. Use your expertise wisely and evaluate all associated risks before making an investment decision.

Octa is an international broker that has been providing online trading services worldwide since 2011. It offers commission-free access to financial markets and various services used by clients from 180 countries who have opened more than 52 million trading accounts. To help its clients reach their investment goals, Octa offers free educational webinars, articles, and analytical tools. 

The company is involved in a comprehensive network of charitable and humanitarian initiatives, including the improvement of educational infrastructure and short-notice relief projects supporting local communities.

Since its foundation, Octa has won more than 100 awards, including the 'Most Reliable Broker Global 2024' award from Global Forex Awards and the 'Best Mobile Trading Platform 2024' award from Global Brand Magazine.