Understanding Basic Terms

essential terminology for sagemaster users understanding these terms will help you navigate the platform more effectively and make better informed trading decisions general trading terms algorithmic trading automated trading using computer programs following predefined rules to execute trades api (application programming interface) a secure method allowing sagemaster to communicate with exchanges backtest a simulation of a trading strategy using historical data to evaluate its potential performance market order an order to buy or sell immediately at the current market price limit order an order to buy or sell at a specific price or better stop order an order that becomes a market order when a specified price is reached take profit (tp) an order to close a position at a profit target stop loss (sl) an order to close a position at a specified loss limit long position buying an asset with the expectation that its value will increase short position selling an asset with the expectation that its value will decrease leverage trading with borrowed funds to multiply potential returns (and risks) margin the collateral required to open a leveraged position liquidation forced closure of a position when margin requirements are not met realized profit/loss profit or loss from closed positions unrealized profit/loss current profit or loss on open positions drawdown the peak to trough decline during a specific trading period break even point the price at which a trade neither makes nor loses money roi (return on investment) percentage gain or loss on your initial investment sagemaster specific terms base order the initial order placed in a dca strategy extra/safety order additional buy orders executed at lower prices to reduce average entry price dca cycle a complete set of base and safety orders for a single trading strategy smart take profit dynamic take profit that adjusts based on market conditions smart trailing trailing stop mechanism that follows price movements to maximize profit grid lines price levels where buy or sell orders are placed grid range the price range between the uppermost and lowermost grid lines grid step the price distance between adjacent grid lines grid spacing linear or geometric distribution of grid lines bearish grid grid strategy optimized for downward market trends breakeven adjustment automatically moving stop loss to entry price after reaching a specified profit level drawdown limit maximum allowed loss before automatically closing a position partial close closing a specific percentage of a position at different price levels trailing stop a stop loss that adjusts as the price moves in your favor order session a group of related orders managed together money management risk control settings to limit exposure per trade magic terminal command line interface for advanced platform interactions webhook an integration point that allows external platforms (like tradingview) to trigger actions ai basket a diversified portfolio of assets managed using ai strategies current value the present market value of your open positions investment the total capital allocated to a specific strategy tradingview webhook a method to connect tradingview alerts to sagemaster for automated trade execution market condition terms volatility the rate at which the price increases or decreases for a given asset sideways market a market showing horizontal price movement in a range trend the general direction of market movement support level a price level where buying pressure tends to overcome selling pressure resistance level a price level where selling pressure tends to overcome buying pressure risk management terms risk reward ratio the proportion of potential profit to potential loss diversification spreading investments across different assets to reduce risk risk per trade the percentage of your portfolio risked on a single trade portfolio management the process of selecting, monitoring, and adjusting the assets in a trading portfolio in the following sections, we'll guide you through setting up your account, connecting exchanges, and navigating the platform's features to start implementing your trading strategies effectively