Glossary

An option contract giving the owner the right (but not the obligation) to buy a specified amount of an underlying security at a specified price within a specified time. A call becomes more valuable as the price of the underlying asset (stock) appreciates.

A charting method used to display open, high, low and close prices for a security, Candlesticks were invented by a 17th century Japanese rice broker, Munehisa Homma, who was one of the first Japanese traders to use price history to predict future prices. His trading theories and principles evolved into the candlestick charting techniques used today.

A candlestick uses the top and bottom of its bar to indicate high and low prices of the time frame indicated. The bar is referred to as a "real body" and connects the opening and closing prices. The real body shows the opening and closing prices with a clear, or a dark, rectangle. When the rectangle or real body is clear, it means that the stock closed above its opening price. When the real body is dark, it means that the stock closed below its opening price. The bars that extends above and below the real body are called the upper shadow and lower shadow respectively. Candlestick patterns can be used alone, but are extremely powerful when used in conjunction with other charting indicators.

Chart Type describes the format of the chart to be presented. A chart is a graphical method of showing where stock prices have been over specific time frames and is used by stock market analysts. A chart has an x-axis (horizontal) and a y-axis (vertical). Typically, the x-axis represents time and the y-axis represents price. There are many different types of charts that can be used to display stock prices. Two such types are a Bar Chart or a Candlestick Chart.

Classic is a term used to refer to a group of patterns that typically have a longer-term horizon (greater than 12 days) and which have distinct price swings such that the price swings form distinctive patterns. The names of classic patterns often reflect the shape of the formation such as the Double Top, Double Bottom, Head and Shoulders Top, Ascending Triangle and so on.

The price of the financial instrument at the close of trading on the day that the event was detected. The close price is set as the last trading price before the exchange or market on which it is traded closes for the day. With after-hours trading, however, the opening price at the start of the next trading day may be different from the closing price the day before.

A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often used as inputs in the production of other goods or services. The quality of a given commodity may differ slightly, but it is essentially uniform across producers. When they are traded on an exchange, commodities must also meet specified minimum standards, also known as a basis grade.

Confirmation or validation that an event has occurred. Events are first recognized and deemed to have occurred based on the definition of the event type. The date on which an event is "found" is referred to as the "event date". Each event type must pass additional criteria to be considered "confirmed". This provides additional assurance that the event is valid.

The date on which the event meets this additional confirmation criteria is referred to as the "confirmation date". Many events are "confirmed" on the same date that they are "found". In this case, the "event date" is the same as the "confirmation date". However some events are "found" on one date, and then "confirmed" at a later date.

The date on which it was confirmed that an event had occurred.

The confirmation type indicates how the event was confirmed to have occurred. Classic Patterns are found or recognized based on the price movements creating a specific formation. The pattern is finally confirmed when the price of the stock breaks through the "breakout price" of the instrument. The breakout price is a price threshold determined by the definition of the pattern type. Valid confirmation types for Classic Pattern events are:

* Confirmed because the Close Price penetrated Breakout Price
* Confirmed because the Price penetrated Breakout Price by 3%
* Confirmed because the Price penetrated Breakout Price by any amount

Price Crosses Moving Average, an indicator, is recognized when the price of the instrument crosses the moving average. However it is not confirmed until the moving average turns in the direction of the anticipated price move, within a specific time period. If the appropriate turn does not occur within the specific time period, the event is considered "not confirmed". Therefore valid confirmation types for Price Crosses Moving Average Indicator events are:

* Undecided. This means that the price crossed the moving average, and confirmation is being watched for.
* Not Confirmed. This means that the price crossed the moving average, however the event has not been confirmed, and confirmation is no longer being watched for.
* Confirmed. This means that the price crossed the moving average, and the event was confirmed by the moving average taking a turn in the
direction of the anticipated price move.

Event types not mentioned here are always considered confirmed. They are not considered found unless they pass the additional confirmation criteria as well. Therefore the event date is the same as the confirmation date.

The risk that a country will not be able to honor its financial commitments.

A contractual agreement in which a borrower receives something of value now, with the agreement to repay the lender at some date in the future. Also, the borrowing capacity of an individual or company.

Any form of money that is in public circulation. Currencies are represented as the amount of that currency required to equal one US dollar.