Okay, so you’ve finally decided to peek into this whole “trading” thing — but the minute you open a chart or watch a video, you’re hit with words like VWAP, strike price, support, resistance, theta decay… and suddenly it feels like you’re back in math class wishing you had paid more attention.
Don’t worry. I got you.
Let’s break this down like we’re texting on a lazy Sunday morning — coffee in one hand, phone in the other.
☕ VWAP — “Where Everyone’s Hanging Out”
Think of VWAP (Volume Weighted Average Price) as the popular table in the cafeteria.
It’s where the average price is — weighted by how many shares actually traded there.
- If price is above VWAP → buyers are running the show.
- If price is below VWAP → sellers are calling the shots.
Traders love VWAP because it shows where “fair value” is for the day. It’s literally the market saying:
“This is where we’ve been hanging out most of the day — are you joining us, or nah?”
🎯 Support & Resistance — “The Floor and Ceiling”
Support = the floor where price tends to stop falling.
Resistance = the ceiling where price tends to stop rising.
Imagine price as a bouncy ball:
- When it hits support, it often bounces back up.
- When it hits resistance, it often smacks into it and comes back down.
The fun part? Once price finally breaks through support or resistance, those levels can flip.
It’s like kicking a hole in the ceiling — now it’s the new floor.
🎟 Strike Price — “Your Ticket to the Show”
Options traders, this one’s for you.
The strike price is basically the price your ticket says you can buy or sell the stock at.
- Buy a Call → You’re betting the stock will be above your strike price by expiration.
- Buy a Put → You’re betting it’ll be below your strike price.
Think of it like buying concert tickets:
- If you got a ticket for Row 5 at $100 but the same ticket is now selling for $200?
You’re thrilled. You could flip it and make a profit. - If ticket prices drop to $50? You overpaid, and that hurts.
⏳ Theta Decay — “Your Option’s Expiration Countdown”
Theta = time decay.
If you’ve ever left an avocado out too long, you get it.
Options lose value as time passes — even if the stock price doesn’t move.
That’s why I say, “Your options are like avocados — use them while they’re fresh.”
🧠 Why This Matters
Trading isn’t just numbers and charts — it’s language.
And once you understand the lingo, you stop feeling like an outsider and start seeing the story the market is telling you.
You don’t need to memorize every single term on day one — just start with a few and practice spotting them in real time. Before you know it, you’ll be throwing around words like VWAP and support levels like you’ve been doing it for years.
Your turn:
What trading term totally confused you when you first started? Drop it in the comments — I might just turn it into the next “Trading Like You’re Texting Your BFF” post.
Gigify 