Trade Trigger

You have your eye on a stock. The stock is currently trading at $15. However, you’ve worked out a strategy to buy shares if the price ever falls to $13. For you, that $13 price point represents a trade trigger.

The term applies to any market situation that causes a trader to make a move. It's an event that, when it takes place, occasions a transaction.

Often the triggers are built into trading algorithms, which automatically make moves based on pre-set circumstances. If a company's earnings come in below a certain amount, or if the government jobs number is higher than expected, or if shares reach a certain price level...all of these can be programmed as trade triggers.