This page is a study reference for common trading terms.

It is not a trading checklist.

Many trading words sound actionable: entry, risk, position, breakout, support, target, order, liquidity.

In LiquidityLab, a term is first treated as vocabulary.

Only after the learner understands the structure, evidence, uncertainty, and review boundary should the term be used inside a study record.

Educational content only. This page does not provide trade direction, entries, exits, stop-loss levels, targets, position sizing, leverage, or return expectations.

How to use this page

Use this reference when a word sounds familiar but imprecise.

For each term, ask:

What does this word describe?
What does it not prove?
What should I observe before using it?

That small pause keeps vocabulary from becoming a shortcut.

Market-state terms

Trend

A market condition where price continues to make progress in one broad direction.

In structure language, an uptrend usually shows higher highs and higher lows. A downtrend usually shows lower highs and lower lows.

What it does not prove:

• that continuation is guaranteed
• that every pullback is safe
• that every new high or low is equally meaningful

Use it as a state label, not a trade instruction.

Range

A market condition where price moves between an upper area and a lower area without clear directional progress.

A range is not "nothing is happening."

It may show balance, rotation, absorption, failed attempts, or uncertainty.

Use it to describe where price is moving, not to assume what price must do next.

Pullback

A temporary movement against the broader trend or prior move.

The word "pullback" only makes sense after the broader structure is named.

Without that background, the same movement could be:

• a normal pause
• a deeper correction
• a range transition
• an early reversal attempt

Bounce

A temporary upward reaction after downward movement.

A bounce does not automatically mean a reversal.

It only says that price reacted upward from an area.

Before giving it more meaning, observe where the bounce happens and whether structure changes afterward.

Sharp drop

A fast downward movement over a short period.

It can reflect urgency, liquidation, thin liquidity, news reaction, or a failed support area.

The term describes speed and magnitude.

It does not prove what the next movement must be.

Structure and price-behavior terms

Key level

An area where price has repeatedly reacted, paused, rejected, or changed behavior.

A key level is better treated as an observation zone than a single exact price.

See: What Are Key Levels?

Support and resistance

Support is an area where price has previously found demand or slowed downward movement.

Resistance is an area where price has previously found supply or slowed upward movement.

In LiquidityLab, these are not buy or sell commands.

They are areas where reaction may be worth observing.

Breakout

A movement beyond a visible level or range boundary.

A breakout becomes more useful as a study term when paired with:

• where the break happened
• how price behaved after the break
• whether price held outside the boundary
• whether the prior structure changed

See: Pullback and Breakout Structures

False breakout

A movement beyond a visible level that fails to hold and returns back inside the prior area.

False breakouts are important because they test whether a level break has real follow-through.

See: False Breakouts at Key Levels

Retest

A later return to an area that price already interacted with.

A retest does not automatically confirm anything.

It is a moment to observe whether the area still matters.

Liquidity area

An area where many orders, stops, attention, or reactions may be clustered.

Common examples include prior highs, prior lows, equal highs, equal lows, and obvious range boundaries.

See: Liquidity Pool

Liquidity sweep

A move through an obvious high or low that tests orders around that area and then reacts.

The sweep itself is not an instruction.

It is a clue that the market tested a visible liquidity area.

See: Liquidity Sweep

Participant-behavior terms

Accumulation

A framework term often used to describe a phase where stronger participants may be building exposure over time.

In LiquidityLab, use it carefully.

Do not assume accumulation just because price is moving sideways.

The safer phrase is:

range behavior that may deserve further observation

Distribution

A framework term often used to describe a phase where stronger participants may be reducing exposure over time.

Like accumulation, it is not directly visible from one candle.

It requires repeated behavior, context, and later confirmation.

Washout

A term used for movements that shake out weak hands or trigger emotional exits.

As a study term, it is useful only after you can describe:

• the prior structure
• the obvious level being tested
• the reaction after the test
• whether the move changed the structure

Market maker

A participant or institution that provides liquidity by quoting both sides of a market.

The term is often overused in retail trading language.

Not every move is caused by "the market maker."

Use the term only when discussing market mechanics or framework language, not as a catch-all explanation.

Order and market-mechanism terms

Market order

An order designed to execute immediately at available prices.

It may experience slippage if liquidity is thin.

This page explains the concept only; it does not recommend order usage.

Limit order

An order placed at a specified price or better.

It may not execute if price does not reach the order or if available liquidity is insufficient.

Order book

A list of current buy and sell limit orders at different price levels.

The order book can change quickly.

It should not be treated as a stable prediction map.

Depth chart

A visual version of order-book liquidity.

It shows cumulative orders around price.

Large visible areas can disappear, move, or be filled, so depth is a reference, not certainty.

Risk and review terms

Risk-reward ratio

A comparison between planned risk and planned reward in a trading model.

In LiquidityLab's public learning layer, this term should stay conceptual.

It should not be used here to create targets, stops, or trade plans.

Win rate

The percentage of samples that produce a favorable result in a defined system or study set.

Win rate is meaningless without context:

• sample size
• risk-reward relationship
• consistency of rules
• whether the samples were collected honestly

Drawdown

A decline from a previous equity peak.

As a study term, drawdown is less about shame and more about survivability:

Can the learning process continue after a difficult sequence?

See: Risk Awareness for Trading Study

Liquidation

In leveraged markets, liquidation can occur when margin is insufficient to maintain a position.

This is a mechanism term.

It is not a reason to use leverage, avoid leverage, or choose a position size from this page.

Framework-specific terms

Some words belong to specific frameworks:

• order block
• fair value gap
• premium / discount array
• BOS / MSS
• Wyckoff phase
• Elliott wave count
• Chan Theory center

Use framework-specific words after writing the neutral structure first.

The safer sequence is:

neutral structure -> evidence and uncertainty -> optional framework translation

Not:

framework label -> assumed market direction

A quick term-check template

When you use a term in a note, add three checks:

Term:
What I mean by it:
What it does not prove:
What evidence would make the term less useful:

Example:

Term: false breakout
What I mean by it: price moved beyond the range boundary and returned inside.
What it does not prove: that the opposite direction must continue.
What would make it less useful: price breaks out again and holds outside the boundary.

This turns vocabulary into reviewable language.

Pair with the glossary

Use this page when you want short explanations grouped by learning context.

Use the Glossary when you want quick definitions and direct links.

Use LiquidityLab Market Structure OS when you want to understand where each term belongs in the learning system.