The Glossary

Markets & mechanics (forex basics)

The pre-method vocabulary from the Markets & Mechanics primer — what a complete beginner needs before the strategy terms below.

• Forex (FX) — the 24/5, decentralized market for trading one currency against another; the largest, most liquid market there is.
• CFD (contract for difference) — how most retail traders access these markets: you settle the price difference with your broker without owning the underlying. Go long or short, with leverage. (Not available to US retail.)
• Currency pair · base / quote — a ratio of two currencies (EUR/USD). The base is what you buy/sell; the quote is the currency the price — and your pips — are measured in.
• Long / short — buy to profit if price rises (long) or sell first to profit if it falls (short). In FX a short is just buying the quote with the base — no borrow needed.
• Pip / pipette — the standard unit of movement: the 4th decimal (0.0001), or the 2nd (0.01) on JPY pairs. A pipette is a tenth of a pip (the extra decimal some brokers show).
• Point — the unit for gold and index CFDs (which move in whole points, valued at $-per-point) rather than pips.
• Lot · pip value — position size: standard (100,000 units), mini (10,000), micro (1,000). Sets what a pip is worth — on a USD-quoted pair ≈ $10 / $1 / $0.10 per pip. Size in micro (0.01-lot) steps.
• Leverage — controlling a large position with a small deposit (e.g. 30:1). Headroom, not risk — your risk is size × stop × pip value.
• Margin · margin call · stop-out — the collateral held for an open position (used vs free margin). If losses eat into it, the broker warns (call) then force-closes (stop-out). Size so you're never near it.
• Spread (bid / ask) — the gap between the sell (bid) and buy (ask) price; the broker's baked-in fee. You buy at the ask, sell at the bid, so every trade starts slightly offside — and the spread widens your effective stop distance.
• Swap — the overnight financing paid or received for holding past the daily rollover (triple on Wednesdays). Mostly irrelevant intraday.
• Order types — market (fill now), limit (fill at a better price), stop (fill on a breakout), plus stop-loss (safety exit — always) and take-profit (auto-close at target).
• Sessions — Sydney / Tokyo / London / New York; the London–NY overlap (~8 AM–noon ET) carries the most volume. This method trades the New York session.

Structure & price action

• Body closure — a candle body closing beyond a level. Structure and breaks are defined by bodies, never wicks.
• Structure — the trend skeleton, read on body closes. Bearish = lower low (body close) → lower high → body close below the low; inverted for bullish.
• Sweep — price trades through a level with the wick only. Liquidity is taken; nothing structural is proven. Information, not confirmation.
• Break — a candle body closes beyond the level. Acceptance — the structural narrative changes.
• The asymmetry — a wick is enough to fail a zone, but never enough to break structure.
• True leg — the real impulse leg, defined by its swing high and low. Everything between is internal structure.
• Internal vs swing structure — breaks inside the true leg are internal and are not trend changes; only the leg's extremes define the trend.
• Structural liquidity — a real pivot: a high that broke a low with the body (or inverted). No pivot → nothing to sweep.
• Front leg — after substantial price action, stale zones aren't traded; the new leg builds its own zones.

Zones (Points of Interest)

• Zone — a supply or demand area, drawn off the opposite-colour candle before the impulse. Exists only once the candle closes beyond it.
• Imbalance — the inefficiency left by the impulse away from a zone; a zone can be enlarged to take the POI plus the adjacent imbalance (never the whole range).
• Mitigation — price returning to tap a zone. The mitigation point is where the pullback began; liquidity must form to its right.
• Flip zone — the core POI: an opposing zone gives a reaction → reaction leg → failure, and flips. Drawn at the extreme of the reaction leg — the last opposite-colour candle before the move that caused the failure — never across the old failed zone.
• Liquidity POI — a zone created when price sweeps liquidity then breaks structure (a "protected" high/low). Valid while unmitigated, refined inside HTF zones, ideally with inducement at its edge.
• Protected high / low — the high/low created by a sweep-plus-structure-break; the invalidation sits beyond it.
• Inducement — structural liquidity (a level that broke something) resting close to a zone's edge. Distant resting liquidity is just liquidity, not inducement.
• Chain — a series of several (3+) stacked mitigations up or down a leg; tradeable while targets remain open.
• Extreme / decisional — the leg's origin (extreme) and the mid-leg zone that began the final push (decisional).
• LPOD / LPOS — the Last Point Of Demand / Supply prior to an action (mitigation, sweep, or structural break). Positionally significant by definition.
• CPB (catalyst for a pullback) — a zone you expect to trade through; at most it pulls price back into a real POI. Not a tradeable POI. Requires opposing HTF order flow in control.
• Refinement — dropping a timeframe to find a tighter zone nested inside an HTF one — never to invent a new narrative. A 1-minute zone is valid only as a refinement.
• Wicks-to-wicks zone — often gives a reaction, rarely follows through. Reference only.

Order flow

• Order flow — who is in control right now, read through the behaviour of zones (reactions, failures, respects). Distinct from structure, which records where price has been.
• Order flow shift — a confirmed change of control, proven by exactly one of two triggers (below).
• FLOR — First Level Of Respect — the first opposing zone that holds after the LPOD/LPOS break (or a reaction-failure). The break creates the zone; the hold confirms the shift — "no floor until it holds." A respect event, never the break itself.
• Trigger 1 — LPOD/LPOS break — a body-close break of the LPOD/LPOS prior to the action. Positional, not visual. The break sets the shift in motion; you're pro only once a zone in the new direction holds (the FLOR). The first zone after the break is valid, not yet pro.
• Trigger 2 — reaction-failure + first respect — an opposing zone reacts and fails, then a new zone in the new direction holds — the FLOR (first level of respect). A sweep does not count as a respect.
• The asymmetry rule — one side losing control does not put the other side in control. The market is often neutral — wait, don't switch.
• Supporting state — "zones holding" / "pro order flow" describe the situation after a shift; they are evidence, never a trigger. Name the event.
• Pro order flow — the shift is confirmed and a prior zone has already held (the "first level of respect"). The first zone after a shift is valid but not yet pro.

Targets

• IRL (internal range liquidity) / the void — the internal structural liquidity building inside a leg. Counter-trend price action is IRL being built; it becomes the target once order flow realigns.
• Void fill — first IRL piece breaks → opposing order flow takes control → the remaining void is the magnet.
• Weak high / low — a valid target, but only in order: (1) it failed to break the opposing structural point, then (2) order flow took control toward it.
• Strong high / low — a level that broke something with a body. Sweepable liquidity, never targeted through. Old strong levels decay into IRL once the trend context flips.
• Target expiry — once a target is taken, the idea is finished. Rebuild targets before re-engaging, and continue in segments.

Candle profiling

• Candle profiling — reading the current daily/weekly/monthly candle against the previous one, for context — never intraday, never dictating the bias alone.
• One-side rule — single breaks dominate (~72% of GBPUSD days, ~79% of weeks; ~84–88% take at least one side). Once one side is taken, don't expect the other within the same candle — and from the prior range alone the direction is a ~50/50 coin flip.
• Inside bar — takes neither side (~15.8% of GBPUSD days; ~1 in 6). Both directions open; the precondition for an outside bar — and on the tape slightly more common than one.
• Outside bar — takes both sides (~12.3% of GBPUSD days; ~1 in 8, the rarest of the three). Usually follows an inside bar; never predicted; back-to-back outside bars are very unlikely.
• Daily wick logic — if today already took the previous daily high, a sell just prints a bigger wick — you'd be predicting wick size. Counter-candle trades are downgraded.
• Catalyst timing — the catalyst is the turn that sets a period's direction (where its directional extreme prints); it forms early — first week of the month, Monday/Tuesday of the week, Asia/London of the day (NY only on high-impact NY news). A different sense of "catalyst" from a CPB ("catalyst for a pullback").
• Range budget — each pair's typical daily range (GU ~80–100 pips). Once spent, further trades catch the tail end.

Execution & risk

• The 1-minute entry model — mitigation → liquidity → sweep → trigger → execution. Confirms the 15m zone is holding; it does not find a separate trade.
• Single / double confirmation — single: the first 1m entry model after the sweep (only when pro order flow + aligned + clean arrival). Double: let the first 1m zone hold, then trade the next.
• Trigger (entry) — a flip (reaction + failure) OR a liquidity POI (sweep + structure break, no reaction).
• Vicinity execution / same stop, same trade — limit at the zone and market on the failed reaction are the same trade if the stop covers the same invalidation. A planned late fill is not FOMO.
• FOMO — the absence of a pre-built narrative, not lateness. A trade traced to the outlook is planned, however late the fill.
• Invalidation point — where the idea is wrong; the stop sits beyond the most recent swept liquidity, plus a generous buffer. Everything inside that region is noise.
• R-multiple — risk measured in units of the stop distance (1R = the stop). Targets and management are expressed in R.
• The 2R rule — break even at the perfect-model 2R; ~3R preferred to the target, 2R the acceptable floor; runner only when HTF-aligned. (There is no "1R" trigger.)
• Proximity veto — if a relevant zone sits so close that 2R can't be reached before tagging it, skip the trade or wait for that zone to break.
• Trade grade — High probability (order flow + confirmed target + pro POI) / Valid (one component missing) / Invalid (neither — no trade).
• The LPOD risk rule — never sell the bounce out of a holding pro-order-flow LPOD after a sweep (sweep vs break is unknowable in the moment). Be in before it and risk-off, or wait for the break.

Process

• Weekly outlook — the pre-commitment artifact: narrative + expiry, zone classification, staged targets, the pullback question, and the pivot — all decided before the week opens.
• The three outcomes — a deep pullback to the POI, an early turn via new 15m zones, or the pivot (the conditional bias flip).
• The pivot — the pre-written trigger that flips the bias, with its own pre-named target. The bias can be wrong and the week still go fine.
• No man's land — price between HTF zones with no anchor; run the week on 15-minute order flow + 15-minute targets only.
• Confluence-pillar audit — tag each trade's components, filter the data, and compute what each rule actually earns. The 2R/3R protocol is personal-data-derived.