Range: The total distance between the low and the high price for a specific time period.
Rate-of-Change (percent): An oscillator (momentum) that measures the percent change in price from one period to the next. The oscillator fluctuates above and below the zero line as the rate-of-change moves from positive to negative. The oscillator can be used as any other momentum oscillator by looking for higher lows, lower highs, positive and negative divergences, and crosses above and below zero for signals.
Ratio Analysis: The use of a ratio to compare the relative strength between any two entities. For example, an individual stock divided by the S&P 500 index can determine whether that stock is outperforming or underperforming the stock market as a whole. A rising ratio indicates that the numerator in the ratio is outperforming the denominator. Trend analysis can be applied to the ratio line itself to determine important turning points.
Reaction High: An intermittent high that forms as price action fluctuates. Whether a security is uptrending, downtrending or trading sideways, intermittent highs and lows form due to changes in supply and demand.
Reaction Low: An intermittent trough that forms as a security fluctuates. Whether a security is uptrending, downtrending or trading sideways, intermittent highs and lows form due to changes in supply and demand.
Reaction Rally: Following a decline, an increase in price that does not surpass the high from which the decline began.
Record High Percent: A breadth indicator that is the 10-day SMA of the High-Low index.
Rectangle: Also referred to as a channel, a rectangle is a continuation pattern where prices move sideways between two different levels for a period of time and then continue moving in the direction of the previous trend.
Relative Strength Index (RSI): A popular oscillator plotted on a vertical scale from 0 to 100. Values above 70 are considered overbought and values below 30, oversold. When prices are over 70 or below 30 and diverge from price action, a warning is given of a possible trend reversal. Read more on RSI.
Resistance: Also referred to as a supply line, resistance is a price level at which there is a large enough supply of a stock available to cause a halt in an upward trend and turn the trend downward.
Retracement: A decline that retraces a percentage of a previous move up, or an advance that retraces a percentage of a previous move down. Retracements typically cover 1/3 to 2/3 of the previous move, and a retracement of more than 2/3 typically signals a reversal in trend.
Reversal Spike: A turn in the market resulting in a breakout that happen very quickly with little or no transition period. These spikes tend to occur when a market becomes very overextended in one direction, when a sudden piece of adverse news causes a sudden reversal. Reversal spike highs ( or “blowoffs”) and lows (aka selling climaxes) can signal a reversal or deceleration of a trend. Very difficult to forecast.
Reverse Stock Split: A stock split which reduces the number of outstanding shares and increases the per-share price proportionately.
Reward-to-Risk Ratio: A calculation equal to the potential reward divided by the potential risk of a position. A long position entered at 100 with potential reward estimated at 120 and potential risk of 90 would have a reward-to-risk ratio of 20:10, or 2 to 1. Generally, a higher reward-to-risk ratio is a more appealing trade. For a long position, potential reward might be based on breakout projections, resistance levels or retracement estimates. Potential risk might be based on support levels, stop or loss requirements.
Rising Three Methods: A bullish continuation pattern. A long green candle is followed by three small candles, each fully contained within the range of the high and low of the first. The fifth candle closes at a new high.
Rising Wedge: A bearish pattern that begins wide at the bottom and contracts as prices move higher toward a support break. Read more on the Rising Wedge.
Rounding Bottom: Also referred to as a “saucer” bottom, it is a reversal chart pattern representing a long consolidation period that turns from a bearish bias to a bullish bias.
RSI: See Relative Strength Index.
Runaway Gap: A price gap that usually occurs around the middle point of an important market trend. For that reason, it is also called a measuring or continuation gap.
Russell 2000 ($RUT): The Russell 2000 tracks 2000 smaller companies.