Trading Glossary

Algorithm (Algo)

A set of programmed rules and instructions that automatically execute trades based on predefined conditions. Trader Origin algorithms analyse market data and place trades without manual intervention.

API (Application Programming Interface)

A connection that allows two software systems to communicate. In trading, you connect your exchange API keys to a bot platform (like AstraBit) so it can execute trades on your behalf.

AstraBit

Trader Origin's exclusive automation partner. AstraBit is the platform where you subscribe to and run our pre-built algorithms. It handles bot execution and connects to your exchange.

Backtest

Testing a trading strategy using historical market data to see how it would have performed in the past. Backtesting helps validate strategy logic before risking real capital. Note: past performance does not guarantee future results.

Bot

Short for "trading bot" - automated software that executes trades based on signals from an algorithm. The bot runs 24/7 on a platform like AstraBit.

Breakout

When price moves above a resistance level or below a support level with increased momentum. Some algorithms are designed to identify and trade breakout patterns.

DCA (Dollar Cost Averaging)

A strategy that involves making multiple purchases at different price levels rather than one large purchase. In Trader Origin algorithms, DCA refers to entering positions in stages (e.g., 12-level DCA means up to 12 entry points). This helps average down the entry price during volatility.

Example: Instead of buying $1,200 at one price, a 12-level DCA might buy $100 at 12 different prices as the market moves.

Drawdown

The peak-to-trough decline in account value during a specific period. It measures the largest loss from a high point before a new high is reached. Drawdown is a key risk metric.

Example: If your account went from $10,000 to $8,500 before recovering, the drawdown was -15%.

Entry

The point at which a trade is opened (a position is entered). An algorithm's entry logic determines when and at what price to buy or sell.

Exchange

A platform where cryptocurrencies are bought and sold (e.g., Binance, Bybit, HyperLiquid). Your trading bot connects to an exchange via API to execute trades.

Leverage

Borrowing funds to increase position size beyond your actual capital. 2x leverage means you control $2,000 with $1,000 of your own money. Higher leverage amplifies both gains AND losses.

Trader Origin Note: Our performance data is shown at 1x (no leverage) to represent base returns. Using leverage is optional and increases risk.

Liquidation

When a leveraged position is forcibly closed by the exchange because losses have consumed the margin (collateral). This typically results in losing most or all of the position's value.

Long Position

A trade that profits when the price goes up. "Going long" means buying an asset with the expectation it will increase in value.

Margin

The collateral required to open and maintain a leveraged position. Isolated margin limits risk to that specific position; cross margin uses your entire account balance as collateral.

Mean Reversion

A trading strategy based on the theory that prices tend to return to their average over time. Mean reversion algorithms look to buy when prices are below average and sell when above.

Momentum

The speed and strength of price movement in a particular direction. Momentum strategies aim to ride strong trends rather than predict reversals.

PnL (Profit and Loss)

The net profit or loss from trading over a period. Usually expressed as a percentage of the initial capital. Our performance tables show monthly and cumulative PnL.

Position

An open trade. When you buy an asset, you have an open position until you sell it (close the position).

Position Sizing

Determining how much capital to allocate to a single trade. Proper position sizing is crucial for risk management.

Resistance

A price level where selling pressure tends to prevent further upward movement. When price breaks through resistance, it may signal a bullish breakout.

Risk Management

Strategies and techniques to limit potential losses. This includes position sizing, stop losses, and diversification. Never risk more than you can afford to lose.

Short Position

A trade that profits when the price goes down. "Going short" or "shorting" means selling an asset you don't own, with the intention of buying it back at a lower price.

Signal

An alert generated by an algorithm indicating a trading opportunity. Signals are sent to a bot platform which then executes the trade. Trader Origin generates signals; AstraBit executes them.

Slippage

The difference between the expected price of a trade and the actual executed price. Slippage typically occurs during high volatility or low liquidity.

Stop Loss

An order to automatically close a position at a specified price to limit losses. For example, setting a stop loss 5% below your entry price.

Support

A price level where buying pressure tends to prevent further downward movement. When price breaks through support, it may signal a bearish move.

Take Profit

An order to automatically close a position at a specified profit target. This locks in gains when the price reaches your target level.

Timeframe

The period each candlestick represents on a chart (e.g., 1-minute, 1-hour, 1-day). Different algorithms operate on different timeframes based on their strategy.

TradingView

A popular charting platform that supports custom indicators and strategies written in Pine Script. The Genesis Engine runs on TradingView.

Webhook

A method of sending automated alerts from one system to another. In trading, TradingView sends webhook alerts to bot platforms like AstraBit to trigger trade execution.

Whipsaw

Rapid price movements in both directions that trigger stop losses or cause losses for trend-following strategies. Choppy, sideways markets often cause whipsaw.

YTD (Year-to-Date)

Performance measured from January 1st of the current year to the present date. YTD returns show how an algorithm has performed since the start of the year.