Stock Trading Terms

Stock Trading Terms – Where To Find The Meanings For Any One You Would Ever Want To Know About – And Come Across As A Stock Market Expert At Your Next Cocktail Party

Many people are dazed, bewildered and confused when hearing others throw out certain stock trading terms.

Even simple ones like “margin call”, “after hours trading”, ‘advance-decline index” etc. draw blank stares from those not “in the know”.

But there is a place on the Internet you can go to get the meanings not only of the most obvious stock market terms, but even some extremely “esoteric” terms as well.

How about the term “Andrew’s Pitchfork”? Or what the heck is the “Aroon Indicator”? Not to mention the “Bear Flattener”, “Casino Finance”, the “Chande Momentum Oscillator”, the “Dead Cat Bounce”, and so forth.

Anyway, when some smart aleck starts throwing out some of the more arcane stock trading terms like those at the next cocktail party you go to, here’s what you can do.

Simply head over to Investopedia.com.

This amazing website has the definitions of just about any stock trading term you will ever come across in normal (and abnormal!) conversation.

Take the stock trading term “Andrew’s Pitchfork”. Investopedia gives this complete definition, with a chart example:

A technical indicator that uses three parallel trendlines to identify possible levels of support and resistance. The trendlines are created by placing three points at the end of identified trends. This is usually achieved by placing the points in three consecutive peaks or troughs. Once the points have been placed, a straight line is drawn from the first point that intersects the midpoint of the other two. Also known as "median line studies".

Or take the mysterious “Aroon Indicator”. Here you go:

A technical indicator developed by Tushar Chande used for identifying definable trends in an underlying security. It is made up of two lines: one line is called "Aroon up", which measures the strength of the uptrend, and the other line is called "Aroon down", which measures the downtrend. The indicator reports the time it is taking for the price to reach, from a starting point, the highest and lowest points over a given time period, each reported as a percentage of total time. Both the Aroon up and the Aroon down fluctuate between zero and 100, with values close to 100 indicating a strong trend, and zero indicating a weak trend. The lower the Aroon up, the weaker the uptrend and the stronger the downtrend, and vice versa. The main assumption underlying this indicator is that a stock's price will close at record highs in an uptrend, and record lows in a downtrend.

What about the “Bear Flattener”? No sweat:

A yield-rate environment in which short-term interest rates are increasing at a faster rate than long-term interest rates. This causes the yield curve to flatten as short-term and long-term rates start to converge.

“Casino Finance”? That’s an easy one…

Any investment strategy that is classified as extremely high risk.

“Chande Momentum Oscillator”? Investopdedia says…

A technical momentum indicator invented by the technical analyst Tushar Chande. It is created by calculating the difference between the sum of all recent gains and the sum of all recent losses and then dividing the result by the sum of all price movement over the period. This oscillator is similar to other momentum indicators such as the Relative Strength Index and the Stochastic Oscillator because it is range bounded (+100 and -100).

Finally, the “Dead Cat Bounce” (sorry, feline lovers!)…

A temporary recovery from a prolonged decline or bear market, after which the market continues to fall.

So, next time that smart aleck tries to impress you by spewing out a bunch of stock trading terms to you – just put on an all-knowing look on your face and say to him: “That sounds great, George, but my analysis of your last stock showed an Andrew’s Pitchfork, and my Aroon Indicator and Chande Momentum Oscillator are telling me we are in a Bear Flattener market environment. Yeah, we may see a Dead Cat Bounce here, but it sounds like Casino Finance to me at this stage”.

I think that should be enough to silence your smart aleck friend.

Now, on to business.

As I am typing these words, all market indexes are “in the green”. Blue chips are leading the parade today, with the Dow up almost 60 points. The NAS is up slightly, but may need some time to recover from the fourth heavier volume decline in the past four weeks.

Here’s a stock recovering nicely today…

Our stock for review today is ANGO – Angiodynamics Inc.

ANGO has formed the right side of a cup base in just seven trading days, and is poised to form the handle now for the cup and handle base scenario. It’s up over 7% today on volume 866% above normal.

ANGO looks like a “dynamic” stock for your portfolio!

And whenever you are stuck on any stock trading term – just head over to Investopedia.com to become an “Instant Expert” on any term you like!