Day Trading Cheat Sheet 2026

The 30 highest-yield Day Trading facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. In day trading, what does VWAP stand for and why is it used? → Volume-Weighted Average Price; used as a benchmark to assess trade quality
2. What does it mean when a stock is 'halted' during regular trading hours? → Trading in the stock is temporarily suspended by an exchange
3. What does it mean when a stock's price 'walks the band' along the upper Bollinger Band? → The stock is in a strong uptrend with sustained momentum
4. What is a market order? → An order to buy or sell immediately at the best available current price
5. A ______________ candle pattern is the one seen below. → Bearish Engulfing
6. A trader only reads articles that confirm their bullish bias on a stock they hold. This psychological pattern is called: → Confirmation bias
7. Which technique is most effective for a day trader who finds themselves making impulsive trades after a significant loss? → Take a mandatory break and review your trading plan
8. What exactly is this three-day pattern of trend reversal? → Bullish Outside Up
9. Which pattern forms when price makes lower highs and higher lows, converging toward an apex? → Symmetrical triangle
10. Which types of charts offer an understanding of market psychology? → Candlestick chart
11. Slippage in day trading refers to: → The difference between the expected execution price and the actual fill price
12. A trailing stop order differs from a fixed stop-loss in that it: → Automatically adjusts its trigger price as the stock moves in your favor
13. What kind of candle is this? → Doji
14. Which pattern is the inverse (bearish counterpart) of a cup and handle? → Inverse cup and handle
15. In day trading, a 'MACD crossover' buy signal occurs when: → The MACD line crosses above the signal line
16. What does this candle pattern's name mean? → Morning Star
17. The Parabolic SAR indicator is primarily used to: → Identify potential reversal points and trailing stop levels in trending markets
18. What is a 'float' in the context of a stock? → The portion of shares available for public trading
19. How do you define "bearish"? → market going down
20. How does a candlestick chart show the daily high price? → trendline
21. The Stochastic Oscillator compares a security's closing price to its price range over a given period. A reading above 80 generally indicates: → The asset is in overbought territory
22. What psychological benefit does a written trading plan provide beyond outlining a strategy? → It serves as an external commitment device that reduces in-the-moment emotional decisions
23. What is 'risk of ruin' in day trading? → The probability that a trader's account will be depleted to zero
24. In technical analysis, what is a 'support level'? → A price point where buying interest has historically prevented further declines
25. An Electronic Communication Network (ECN) in day trading is: → An automated system that electronically matches buy and sell orders
26. What does a 'doji' candlestick indicate? → Indecision in the market, where the open and close prices are nearly equal
27. True/False: Early in the cycle, candlestick charting is ineffective at spotting market reversals. → False
28. The '1% rule' in day trading risk management states that a trader should risk no more than: → 1% of total account equity per trade
29. After a string of five winning trades, a day trader doubles their position size without adjusting their risk parameters. This is most likely caused by: → Overconfidence bias
30. What does a 'shooting star' candlestick pattern indicate when it appears after a rally? → Bearish reversal — buyers pushed price up but sellers rejected the move