EDGELOG

Futures trading terms, in plain English

Every dotted term on the free EdgeLog prep sheets explains itself with a tap. This page is the same glossary in one place: what each term means, and why it matters at the open. Written for ES and NQ futures traders, no prior tape-reading vocabulary assumed. See them in context in Morning Edge, the free pre-market prep tool.

Session structure and levels

RTH · Regular trading hours

The main US day session, 9:30 AM to 4 PM ET. Everything outside it is the overnight (Globex) session.

Why it matters: The prep sheet preps the RTH open, the highest-volume decision point of the day.

ONH · Overnight high

The highest price traded in the overnight (Globex) session, 6 PM to 9:30 AM ET.

Why it matters: Overnight extremes trap traders: setups #1 and #2 on the prep sheet fire at ONL and ONH.

ONL · Overnight low

The lowest price of the overnight (Globex) session.

Why it matters: Break it, fail, reclaim it, and the sellers who chased are trapped: that is the ONL Failed Breakdown, the prep sheet's core long.

PDH · Prior day high

Yesterday's highest price during regular hours, 9:30 AM to 4 PM ET.

Why it matters: The open vs PDH and PDL defines gap days: an open above PDH is a Gap Up by definition.

PDL · Prior day low

Yesterday's lowest price during regular hours.

Why it matters: An open below PDL is a Gap Down, and PDL becomes the decision level: holds extend the move, fails fill the gap.

Prior close (settlement)

Yesterday's official closing price for the session.

Why it matters: Gap days tend to pull toward it: that is the gap-fill target.

Settle (settlement price)

The day's official closing price for the contract.

Why it matters: The gravity line of the overnight: price auctions around it all evening, and gap math measures from it.

IB · Initial balance

The range built in the first hour of the day session, 9:30 to 10:30 ET.

Why it matters: Balance-day playbooks wait for this range to break before picking a side.

IBH · Initial balance high

The top of the first hour's range. It only exists after 10:30 ET, so fill it in then.

Why it matters: Setup #6 and the continuation plays key off IBH and IBL breaks.

IBL · Initial balance low

The bottom of the first hour's range, known after 10:30 ET.

Why it matters: A break below IBL that fails and reclaims is a long trigger on stretched days.

VWAP and value

Full Session VWAP

The volume-weighted average price: a running average of the session, weighted by where volume actually traded, anchored to the 6 PM ET reopen.

Why it matters: The day's center of gravity. Most setups here target a return to it, and the open's distance from it sets your Step 2 zone.

Standard deviation bands

Bands drawn 1 and 2 standard deviations around VWAP: normal vs stretched distance from the average.

Why it matters: An open 2 bands out is stretched: reversion setups strengthen, chasing gets expensive.

VPOC · Volume point of control

The single price where the most volume traded: the session's consensus price.

Why it matters: A magnet and a common target, alongside VWAP.

POC · Point of control

The single price where the most volume traded in a session: the market's consensus price.

Why it matters: A magnet and a common target. On the prep sheets, RTH POC means the day session's POC carried into the night.

VAH · Value area high

The top of the value area, the zone holding roughly 70% of the session's volume.

Why it matters: Trading above VAH means the market is repricing higher; rejection there rotates back toward POC.

VAL · Value area low

The bottom of the value area, the zone holding roughly 70% of a session's volume.

Why it matters: Setups #7 and #8 trade failed breakdowns at the daily and weekly VAL.

Value area

The zone holding roughly 70% of a session's volume, bounded by VAH above and VAL below, with POC at its center.

Why it matters: Inside it the market is in balance; outside it, price is repricing and the playbook changes.

The dealer map (options positioning)

GEX · Gamma exposure

A dollar estimate of how hard option dealers must hedge when the market moves 1%. High GEX pins the tape; low GEX lets moves travel.

Why it matters: It is the day's speed limit: the Green / Yellow / Red pill tunes targets and how long you let runners run.

Gamma flip

The price where dealer hedging switches sides: above it their flows calm the tape, below it they chase and accelerate it.

Why it matters: Above the flip, dips get bought and fading works. Below it, moves extend, stops need room, momentum leads.

Call wall / put wall

The option strikes carrying the heaviest dealer hedging above (call wall) and below (put wall) the market.

Why it matters: They act like shelves: price often stalls on the first touch, especially on pinned, high-GEX days.

EM · Expected move (rails)

The options-implied range for the session: how far the market is priced to travel, drawn as rails above and below settle.

Why it matters: The Globex sheets' fuel gauge reads the night's range against the rails: the closer the tank is to empty, the less room the next move has.

Reads at the open

Overnight inventory

Which side built up positions overnight: did the Globex session net buy or net sell into the morning?

Why it matters: Trapped overnight traders are fuel. Sellers trapped under a reclaiming open power the strongest bounce longs.

The 5 open types

A read of how the first 15 minutes behave: Open Drive, Open Test Drive, Open Auction, Open Auction in Range, or a Gap day.

Why it matters: Each type has its own playbook: what to trade, what to skip, how big. The prep sheet's classifier lands on it in two taps.

OD · Open Drive

Price opens and runs one way without returning to the open price. The strongest, most directional open.

Why it matters: Trade with the drive, never fade it: 65% of ES drives follow through (80% on NQ).

OTD · Open Test Drive

Price probes a key level first, gets sharply rejected with a wick and a volume spike, then drives the other way.

Why it matters: The second VWAP cross is the entry, never the first: the probe exists to trap the early crowd.

OA · Open Auction

Two-sided rotation around the open price: both sides probing, no early winner.

Why it matters: Failed-break setups still fire on their own trigger here; continuation trades wait for the first hour's range to break.

OAIR · Open Auction in Range

A quiet, tight open inside yesterday's range on light volume: the market is waiting for information.

Why it matters: Worst stats of the five. Half size or skip, and let the first hour finish before entering.

Spike (late-day)

A one-way push in the final minutes of the day session that closes at or near its extreme: a move the market never got to two-side.

Why it matters: Where the night trades relative to it decides its fate: holding above the spike base is acceptance, losing the base unwinds the spike.

Structural bias

The sheet's summed read of inventory, gamma, VWAP position, walls, and open type: LONG, SHORT, or TWO-SIDED, with 1-3 stars of conviction.

Why it matters: It governs size: with-bias setups run full, counter-bias setups run half.

The setups

Failed breakdown

Price breaks under a key level, cannot hold below it, and reclaims it. Everyone who sold the break is now trapped.

Why it matters: The prep sheet's core long family: the trapped sellers' stops are the fuel.

Failed breakout

The mirror at the highs: price pokes above a key level, fails, and drops back through, trapping the buyers who chased.

Why it matters: Setup #2 shorts the failed break of ONH.

How the numbers are measured

Thin sample

Fewer than 25 recorded triggers in the 531-session study.

Why it matters: Read it as direction, not a base rate: the prep sheet refuses to print a percentage under n=25.

n = sample size

How many times this exact setup triggered across the 531-session study.

Why it matters: Bigger n, steadier number. Under 25 prints as thin instead of a percentage.

M2 · study code

The backtest's internal code for the Failed Breakdown family.

Why it matters: Codes keep every number traceable to a row in the study.

M3 · study code

The backtest's internal code for Gap-Up Reversion.

Why it matters: Same convention: every rate maps to a study row.

Backtested · hypothetical

These rates come from replaying fixed rules over 531 historical sessions, not from live trading.

Why it matters: Hypothetical results have limits: modeled fills, no slippage surprises, no account risk. No promise your results will match. Full method on the Morning Edge sheet, under How the edge is measured.

See every term live, free: Morning Edge preps the 9:30 ET open, Globex Edge: Asia the 18:00 ET reopen, and Globex Edge: London the 03:00 ET open. Not sure which leak is costing you the most? Take the 2-minute Execution Audit.

EdgeLog is an educational tool, not financial advice, and EdgeLog is not a registered investment or trading advisor. Futures trading involves substantial risk of loss and is not suitable for all investors. Any rates referenced here are hypothetical backtest measurements, not live trading results, and past performance does not guarantee future results.

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