Glossary
Explanation of all terms and abbreviations used on the platform. Useful for beginners and experienced traders alike.
APY (Annual Percentage Yield)
How much you'd earn in a year, shown as a percentage. Simply put: if APY is 36%, you'd earn ~$360 on $1,000 over a year. Used in farming and funding arbitrage.
ATR (Average True Range)
A number that shows how much the price typically moves. Simply put: if ATR is $500, the price usually swings about $500 per period. High ATR = wild market; low ATR = calm market.
Accumulation
When big investors quietly buy while prices are low. Simply put: smart money is loading up while everyone else is scared. Often happens before a major price increase.
Bollinger Bands
Three lines on a chart — a middle line (average) with upper and lower bands showing volatility. Simply put: when the price touches the top band, it might be too high; when it touches the bottom band, it might be too low.
Breakout
When the price breaks through support or resistance with strong momentum. Simply put: the price smashes through the 'ceiling' or 'floor' and starts a new trend.
Candle (Candlestick)
A bar on a chart showing 4 prices: open, high, low, and close for one time period. Simply put: a green candle means the price went up during that period; a red candle means it went down.
Capitulation
When investors panic and sell everything at a loss. Simply put: people give up and sell at the worst possible prices. Ironically, this often marks the bottom — prices may recover after.
Confidence
How sure the system is about a prediction, from 0% to 100%. Simply put: 85% confidence means the system is quite sure; 50% means it's basically a coin flip.
Drawdown
The biggest drop in your account value from its peak. Simply put: if your account went from $10,000 to $8,000, that's a 20% drawdown. It shows the worst losing streak.
Divergence
When the price goes one way but an indicator goes the other way. Simply put: if the price makes new highs but the indicator doesn't, it's a warning sign that the trend might reverse soon.
Distribution
When big investors quietly sell while prices are high. Simply put: smart money is cashing out while everyone else is excited. Often happens before a major price drop.
DEX (Decentralized Exchange)
A trading platform without a middleman company. Simply put: instead of trusting a company like Binance with your money, you trade directly with other people through code. You keep your own keys.
Entry Price
The price at which you opened your trade or placed your bet. Simply put: the price you 'got in' at.
EMA (Exponential Moving Average)
A trend line that reacts quickly to recent price changes. Simply put: it's like an average price, but it cares more about what happened recently than a week ago. Helps identify if the price is trending up or down.
Euphoria
When everyone is overly excited and expects prices to go up forever. Simply put: 'this time is different' mentality. Ironically, this often marks the top — a crash may follow.
Edge
A statistical advantage that makes a strategy profitable over time. Simply put: if your strategy wins more than it loses (or wins bigger than it loses), you have an edge. Like how a casino has an edge over players.
Funding Rate
A small fee paid between traders holding long and short positions on perpetual futures. Simply put: it's like a rent — if the rate is positive, people betting on price going up pay those betting on it going down, and vice versa.
FDV (Fully Diluted Valuation)
What the market cap would be if ALL tokens existed right now (including locked ones). Simply put: if a project has 1 billion total tokens but only 100 million are released, FDV shows the value at full supply. Much higher than current market cap means potential dilution.
Hash Rate
The total computing power used to mine and secure a blockchain. Simply put: more hash rate = more miners working = stronger, more secure network. A rising hash rate is usually a healthy sign.
Honeypot
A scam token where you can buy but can never sell. Simply put: it's a trap — the smart contract is designed to steal your money. Always check safety scores before buying new tokens.
Leverage
A tool that multiplies your trading power. Simply put: with 10x leverage, your $100 works like $1,000. But both profits AND losses are multiplied — so higher leverage = higher risk of losing everything.
Long
A trade where you profit when the price goes UP. Simply put: you buy something cheap, hoping to sell it later at a higher price.
Liquidation Price
The price at which the exchange forcibly closes your trade because you've lost too much. Simply put: if the price reaches this level, you lose all the money in that trade. Use stop losses to avoid this.
Liquidity
How easily you can buy or sell without moving the price. Simply put: high liquidity = lots of buyers and sellers, easy to trade; low liquidity = few buyers/sellers, your trade might move the price against you.
Mark Price
The current real-time market price of an asset. Simply put: how much it costs right now. Used to calculate your profit/loss and whether you might get liquidated.
Margin
Your own money that you put up as collateral for a leveraged trade. Simply put: it's like a deposit — the exchange holds it to cover potential losses.
MACD
Moving Average Convergence Divergence — an indicator that helps spot trend changes. Simply put: when the MACD line crosses above the signal line, it may be a good time to buy; when it crosses below, it may be time to sell.
Market Cap
The total value of a cryptocurrency: price × number of coins in circulation. Simply put: it's like the company's total worth in stock markets. Higher market cap = usually more stable and less risky.
MVRV Z-Score
A metric comparing the current price to the 'fair' price based on blockchain data. Simply put: a very high Z-Score means the asset is overpriced; a very low one means it's underpriced. Useful for spotting market cycle tops and bottoms.
Market (Polymarket)
A question that people bet on, like 'Will X happen by Y date?' Simply put: it's like a poll, but people put real money on their answer. When the event happens (or doesn't), winners get paid.
NUPL (Net Unrealized Profit/Loss)
An on-chain metric showing whether most holders are in profit or loss. Simply put: when NUPL is very high, most people are in profit and may sell soon (market top); when it's negative, most are at a loss (potential bottom).
Open Interest (OI)
The total number of active futures/options contracts that haven't been closed yet. Simply put: it shows how much money is actively betting on the market. Rising OI = more traders jumping in.
Outcome (YES/NO)
The side you choose when betting. Simply put: buying YES means 'I think this will happen'; buying NO means 'I think this won't happen'.
On-Chain
Data that comes directly from the blockchain itself. Simply put: instead of looking at charts, on-chain analysis looks at actual transactions — who's buying, who's selling, how much is moving.
PnL (Profit & Loss)
How much money you made or lost on a trade. Simply put: if you bought for $100 and sold for $130, your PnL is +$30. Unrealized PnL = on open trades (not yet sold); Realized PnL = on closed trades (already sold).
Position Size
How much money you put into one trade. Simply put: if you have $1,000 and put $100 on a trade, your position size is $100 (or 10% of your capital).
Perpetual (Perp)
A special type of futures contract that never expires. Simply put: regular futures have an end date; perpetuals let you keep your trade open forever. Most crypto leveraged trading uses perpetuals.
ROI (Return on Investment)
Your profit as a percentage of what you invested. Simply put: if you invested $100 and earned $20, your ROI is 20%. The formula: (Profit / Cost) × 100%.
Risk:Reward (R:R)
How much you can potentially gain compared to how much you risk losing. Simply put: a 1:3 R:R means you risk $1 to potentially make $3. Higher is better.
Realized PnL
Your final profit or loss on trades you've already CLOSED. Simply put: this is real money — you've already sold, and this is what you actually gained or lost.
RSI (Relative Strength Index)
A scale from 0 to 100 that shows whether an asset is 'overbought' or 'oversold'. Simply put: above 70 means too many people are buying (price may drop soon); below 30 means too many are selling (price may rise soon).
Resistance
A price level where the price tends to stop rising and fall back down. Simply put: it's like a ceiling — sellers step in at this price and prevent it from going higher.
Reversal
When a price trend changes direction. Simply put: the market was going up, and now it starts going down (or vice versa).
Regime
The current overall state of the market. Simply put: a 'bull' regime means prices are generally going up; a 'bear' regime means they're going down; 'ranging' means they're going sideways.
Short
A trade where you profit when the price goes DOWN. Simply put: you borrow and sell something expensive, then buy it back cheaper and keep the difference.
Stop Loss (SL)
An automatic order that closes your trade to prevent further losses. Simply put: you set a 'maximum loss' level, and if the price goes against you, the system exits the trade before you lose more.
SMA (Simple Moving Average)
The plain average price over a certain number of days. Simply put: add up the last 20 closing prices and divide by 20. If the price is above the SMA, the trend is likely up.
Support
A price level where the price tends to stop falling and bounce back up. Simply put: it's like a floor — buyers step in at this price and prevent it from going lower.
Shares (Polymarket)
Units of a bet on Polymarket. Simply put: each share costs between $0.01 and $0.99. If you're right, each share pays $1. If you're wrong, it pays $0. The price reflects probability.
Slippage
The difference between the price you expected and the price you actually got. Simply put: you wanted to buy at $100 but ended up paying $101. This happens when there isn't enough liquidity or the market moves too fast.
Take Profit (TP)
An automatic order that closes your trade when it reaches your desired profit. Simply put: you set a target price, and when the price hits it, the system sells for you and locks in the profit.
Timeframe
How much time each candle on a chart represents. Simply put: on a 1H chart, each candle = 1 hour of trading; on a 1D chart, each candle = 1 day. Common options: 1m, 5m, 15m, 1H, 4H, 1D, 1W.
Unrealized PnL
Your current profit or loss on trades that are STILL OPEN. Simply put: it's how much you'd make or lose if you closed the trade right now. It keeps changing with the price.
USDT / USDC
Stablecoins — crypto tokens that are always worth about $1. Simply put: they're like digital dollars. Most trading pairs use USDT or USDC as the base currency.
VWAP (Volume Weighted Average Price)
The average price of an asset, but adjusted for how much was traded at each price. Simply put: it shows the 'true' average price. If the current price is below VWAP, you might be getting a good deal.
Volume
How much of an asset was bought and sold in a given time. Simply put: high volume means lots of people are trading (strong move); low volume means few people are trading (weak or uncertain move).
Volatility
How wildly the price swings. Simply put: high volatility means big price jumps up and down (exciting but risky); low volatility means the price is relatively stable.
Win Rate (WR)
How often your trades are profitable, shown as a percentage. Simply put: if you made 10 trades and 6 were profitable, your win rate is 60%.
Wallet Address
Your unique crypto 'account number' on the blockchain. Simply put: it's like a bank account number — people send crypto to your wallet address, and you send from it.
Whale
Someone who holds a huge amount of crypto. Simply put: a whale is a big player whose buy or sell orders can significantly move the market price. Tracking whales helps predict big moves.