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Definition of Moving Average A moving average (MA) is a calculation that helps smooth out price data by creating a constantly updated average price over a specific time period. Investors and traders use moving averages to identify trends and potential buy or sell signals by filtering out short-term price noise.

Definition of Fibonacci Retracement A Fibonacci Retracement is a technical analysis tool that helps traders identify potential levels where a stock (or any financial asset) might reverse or “bounce back” after a price move.It’s based on the famous Fibonacci sequence — 0, 1, 1, 2, 3, 5, 8, 13, etc. — where each number is the sum of the two before it.

Definition of a Flag Pattern A Flag Pattern is a chart pattern in technical analysis that signals a short pause in a strong trend — like a pit stop before the market continues racing in the same direction. It looks just like it sounds: a small rectangular “flag” that forms after a sharp “flagpole” move up or down.

Definition of Cup and Handle A Cup and Handle is a chart pattern that signals a potential continuation of an uptrend after a brief period of consolidation. Imagine the price forms a “U” shape — that’s the cup. Then it drifts slightly downward or sideways — that’s the handle. When the handle finishes forming, the price often breaks out above the resistance line, signaling that buyers are back in control. It’s like the market taking a sip of coffee before charging full steam

Definition of Head and Shoulders A Head and Shoulders is a classic chart pattern used in technical analysis to predict a potential reversal in the price of a stock, commodity, or index. The pattern looks—quite literally—like a head with two shoulders...

Definition A Double Bottom is a chart pattern in technical analysis that signals a potential reversal in a downward trend. Picture the letter “W.” The price of a stock (or index, or crypto) falls, bounces up a bit, falls again to roughly the same low point, and then rises once more.

Definition of Double Top A Double Top is a chart pattern in technical analysis that signals a possible trend reversal. Imagine a stock price climbing, hitting a peak, pulling back a little, then climbing again—only to hit about the same peak a second time. After failing to break through that “ceiling” twice, the price often turns downward.

Definition of Dead Cat Bounce A dead cat bounce is a temporary recovery in the price of a declining stock or market before it continues to fall further. It looks like a rebound, but it’s short-lived. The name comes from the grim idea that “even a dead cat will bounce if it falls from a great height.” In other words: don’t mistake a quick uptick for a full recovery.

Definition of Bull Trap A Bull Trap happens when investors are tricked into thinking a falling market has turned around and started to rise, but the rally is only temporary. After pulling in optimistic buyers, the market quickly reverses downward again—“trapping” those who bought in too early. Think of it like stepping onto what looks like solid ground, only to discover it’s quicksand.

Definition of Bear Trap A bear trap is a false technical signal that tricks traders into thinking a market or stock is heading downward (bearish), only for it to quickly reverse upward (bullish). It often happens when prices break below a support level, making it look like a downtrend is starting, but then the market rebounds—“trapping” those who sold short or exited too early. In simple terms: a bear trap is when the market fakes you out on the downside.

Definition of Market Correction A market correction is when a stock market index (like the S&P 500 or Dow Jones) drops by 10% or more from its recent high but less than 20%. If the decline goes beyond 20%, that’s considered a bear market. Corrections are a normal part of the market cycle and usually don’t last very long—historically, they often resolve in a few months.

Definition of Volatility Index (VIX) The VIX is calculated by the Chicago Board Options Exchange (CBOE). It’s derived from the prices of S&P 500 index options. Higher option prices often mean investors are bracing for bigger swings in the market, which pushes the VIX higher.

Definition of MSCI MSCI stands for Morgan Stanley Capital International, a company that provides some of the most widely used investment indexes and analytics in the world. Think of MSCI as the “scorekeeper” for global stock markets. When you hear about funds that track the MSCI World Index or the MSCI Emerging Markets Index, what they’re really doing is following the performance of groups of stocks MSCI has bundled together.

Definition of Shanghai Composite Index The Shanghai Composite Index (often called the Shanghai Composite) is the main stock market index that tracks all the stocks listed on the Shanghai Stock Exchange (SSE) in China. Think of it as China’s version of the S&P 500 or Dow Jones in the U.S.—a barometer for how Chinese companies are doing and how investors feel about the Chinese economy.

Definition of the Hang Seng Index The Hang Seng Index (HSI) is the main stock market index for Hong Kong. Think of it as Hong Kong’s version of the Dow Jones or S&P 500. It tracks the performance of the largest and most influential companies listed on the Hong Kong Stock Exchange, including banks, real estate developers, and tech giants.

Definition of Russell 2000 Index The Russell 2000 is a stock market index that tracks the performance of about 2,000 smaller publicly traded companies in the U.S. It’s considered the best measure of how small-cap stocks (companies with relatively small market values) are doing. While the S&P 500 gets all the headlines for tracking America’s biggest corporations, the Russell 2000 gives you a peek into the health of the smaller players that make up the backbone of the U.S. eco

Definition of Nasdaq The Nasdaq (short for the National Association of Securities Dealers Automated Quotations) is both a stock exchange and a stock market index. It’s known for being the world’s first electronic exchange, launched in 1971, and is home to many of the largest technology and growth companies, including Apple, Microsoft, Amazon, and Tesla.

Definition of S&P 500 The S&P 500 (short for Standard & Poor’s 500) is one of the most well-known stock market indexes in the world. It tracks the performance of 500 of the largest publicly traded companies in the United States, covering industries like technology, healthcare, finance, energy, and consumer goods.

Definition of Dow Jones The Dow Jones Industrial Average (DJIA)—often just called “the Dow”—is one of the most widely recognized stock market indexes in the world. It tracks the performance of 30 large, publicly owned companies based in the United States. These companies span multiple industries, making the Dow a quick snapshot of how the stock market—and in many ways, the economy itself—is doing.