TradeTerminal_/glossary

$ futures glossary

54 terms covering everything from basic contract mechanics to advanced order flow concepts. Click any term for the full breakdown.

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54 terms

Pricing→

Backwardation

When futures prices are lower than the spot price. Signals tight supply or strong demand.

Basics→

Bid / Ask / Spread

The prices buyers and sellers are offering, and the gap between them.

Order types→

Bracket Order

An entry order bundled with a profit target and stop loss that auto-cancel each other.

Pricing→

Contango

When futures prices are higher than the spot price. The normal state for most markets.

Instruments→

Contract Specifications

The standardized terms that define a futures contract: tick size, value, hours, and expiration.

Basics→

Daily Settlement

The official closing price used to calculate daily gains, losses, and margin requirements.

Basics→

Day Trade Margin

Reduced margin for positions opened and closed within the same session. Varies by broker.

Basics→

Delivery

The physical or cash settlement process when a futures contract expires.

Data & flow→

Delta

Net aggressive buying minus selling volume. Shows who's pushing price.

Risk→

Drawdown

Peak-to-trough decline in account equity. The number that ends trading careers.

Instruments→

E-mini

Electronically traded, smaller-sized versions of standard index futures (ES, NQ, RTY, YM).

Pricing→

Expiration / Rollover

When a contract expires and traders move to the next month. Happens quarterly for indexes.

Order types→

Fill

When your order is executed and you have an open position. As in, 'I got filled at 5200.'

Pricing→

Front Month

The nearest expiration contract. Most liquid, most traded, and usually the one you want.

Basics→

Futures Contract

A binding agreement to buy or sell an asset at a set price on a future date.

Market structure→

Gap

The price difference between one session's close and the next session's open.

Sessions→

Globex / Electronic Session

CME's electronic overnight trading platform. Lower volume and wider spreads, but always important context.

Strategy→

Hedging

Using futures to offset risk in an existing position or business exposure.

Market structure→

Initial Balance (IB)

The price range of the first hour. A Market Profile concept that sets the day's tone.

Basics→

Leverage

Controlling large value with a small deposit. Amplifies both gains and losses.

Order types→

Limit Order

An order at a specific price or better. You control the price but might not get filled.

Basics→

Limit Up / Limit Down

Circuit breakers that halt trading when price moves too far, too fast.

Data & flow→

Liquidity

How easily you can enter and exit without moving the price. Measured by volume and spread.

Basics→

Lot / Contract Size

The standardized quantity one contract represents: 1,000 barrels, $50 times the index, etc.

Basics→

Margin

The deposit required to open and hold a futures position. A performance bond, not a loan.

Risk→

Margin Call

A demand to deposit more money when your account drops below maintenance margin.

Basics→

Mark to Market

Daily settlement. Gains credited and losses debited from your account every single day.

Order types→

Market Order

Buy or sell immediately at the best available price. Guaranteed fill, not guaranteed price.

Data & flow→

Market Profile

A framework that organizes price activity by time, revealing value areas and balance zones.

Instruments→

Micro Contracts

1/10th-size futures (MES, MNQ, MGC). Ideal for learning and small accounts.

Basics→

Notional Value

The total dollar value a futures contract controls. Usually many multiples of your margin.

Order types→

OCO Order

One-Cancels-Other. Two orders linked so when one fills, the other auto-cancels.

Data & flow→

Open Interest

Total outstanding contracts. Rising OI with rising price means new money entering the trend.

Market structure→

Opening Range

The high-low range of the first 5, 15, or 30 minutes. A key reference for breakout traders.

Data & flow→

Order Book / DOM

The depth of market. Shows resting buy and sell orders at each price level in real time.

Data & flow→

Point of Control (POC)

The price level with the most trading volume. Acts as a magnet for price.

Risk→

Position Sizing

How many contracts to trade based on account size, risk tolerance, and stop distance.

Industry→

Prop Firm / Funded Account

A firm that funds traders with its capital after passing an evaluation. You keep most of the profits.

Sessions→

Regular Trading Hours (RTH)

The main session. 9:30 AM to 4:00 PM ET for equity index futures.

Risk→

Risk-Reward Ratio

Potential loss vs. potential gain. Determines how often you need to win to be profitable.

Pricing→

Rollover

Closing an expiring contract and opening the same position in the next contract month.

Strategy→

Scalping

Trading for small, fast gains with high frequency. Seconds to minutes per trade.

Basics→

Settlement

How a contract resolves at expiration. Cash payment or physical delivery of the asset.

Order types→

Slippage

The difference between your expected price and your actual fill. Worse in thin markets.

Strategy→

Spread Trading

Trading the price difference between two related contracts instead of outright direction.

Order types→

Stop Order

Triggers a market order when price reaches a level. Used for breakout entries and stop losses.

Order types→

Stop-Limit Order

A stop that triggers a limit order instead of a market order. Price control but fill risk.

Market structure→

Support / Resistance

Levels where buying or selling pressure has historically concentrated. Where decisions happen.

Strategy→

Swing Trading

Holding positions for days to weeks. Wider stops, lower leverage, less screen time.

Basics→

Tick

The minimum price movement. Each product has a different tick size and dollar value per tick.

Order types→

Trailing Stop

A stop loss that automatically moves with price to lock in gains as a trade works.

Data & flow→

Value Area

The price range where 70% of volume traded. Market Profile's definition of fair value.

Data & flow→

Volume Profile

Trading activity shown by price level. High-volume nodes attract, low-volume areas repel.

Data & flow→

VWAP

Volume-Weighted Average Price. The institutional benchmark for fair value during a session.

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