Penny Stock Glossary
Every term you'll see on the scanner, explained in plain English. Bookmark this page — it's the fastest way to learn the language of penny stock day trading.
RVOL Relative VolumeToday's volume divided by the stock's average volume at this time of day. RVOL = 5 means the stock is trading 5× its typical pace. Important: high RVOL is not automatically bullish — it can mean heavy selling. Always check price direction and VWAP.
VWAP Volume-Weighted Average PriceThe average price weighted by volume since the open. Above VWAP = bulls in control intraday. Below VWAP = bears in control. Most institutional algos respect VWAP.
FloatNumber of shares actually available for public trading (excludes insider/restricted shares). Low float (under 20M) = explosive moves both up and down.
Short InterestPercentage of the float that is sold short. High short interest (>20%) sets up potential short squeezes on positive catalysts.
HOD / LODHigh of Day / Low of Day. Breakouts above HOD often trigger momentum entries; breakdowns below LOD trigger stops.
PremarketTrading session from 4:00 AM to 9:30 AM ET. Thin liquidity, but where most penny stock catalysts first show up.
After Hours4:00 PM to 8:00 PM ET. Earnings and offerings are typically released here.
Gap Up / Gap DownStock opens significantly higher or lower than the previous day's close. The "gap" is the price discontinuity.
T1 Halt News PendingTrading halted by the exchange because material news is about to hit. Reopens at a new price once the news drops.
T12 Halt Additional InformationThe exchange wants more information from the company before trading resumes — often a red flag.
LULD Halt Limit Up / Limit DownVolatility halt triggered when price moves too fast in 5 minutes. Lasts 5 minutes. Common on penny stocks during squeezes.
SSR Short Sale RestrictionActivated when a stock drops 10%+ from prior close. Shorts can only sell on an uptick — often fuels squeezes.
DilutionCompany issuing new shares (offering, ATM, warrants exercising). Increases float and usually crushes price. The #1 penny stock killer.
ATM At-the-Market OfferingCompany quietly sells shares directly into the market over time. Caps upside on momentum runs.
Reverse SplitCompany combines shares (e.g. 1-for-10) to boost price, usually to maintain Nasdaq listing. Often followed by dilution.
CatalystAny news event that moves price: earnings, FDA news, contract win, partnership, lawsuit, S-1 filing.
Level 2Real-time order book showing bids and asks at every price level. Reveals supply/demand walls.
SpreadDifference between bid and ask. Wide spreads on penny stocks mean high slippage costs.
SlippageThe difference between the price you expected and the price you actually got. Penny stocks slip hard.
HaltedStock is paused. No trades execute. Could last minutes (LULD) or days (T12, regulatory).
Pump & DumpCoordinated promotion to inflate a low-float stock, followed by insider selling into retail buyers. Common in OTC land.
Stealth AccumulationQuiet buying pressure with rising lows but no obvious headline — often precedes a breakout.
FadeTrading against the prevailing move (e.g. shorting a parabolic spike on exhaustion).
ParabolicPrice moving near-vertically. Beautiful on the way up, brutal on the reversal.
BagholderTrader stuck holding a position that's collapsed. Don't be one.
Not financial advice.