Catalyst

A catalyst is the specific news event that gives a stock a reason to move: an earnings report, an FDA decision, a contract award, a merger headline, an offering, an activist filing. Day traders separate moves with a catalyst from moves without one, because catalyst-driven moves attract outside volume and can sustain, while newsless spikes usually retrace.

Catalysts also have a quality hierarchy. Hard catalysts (earnings, FDA approvals, buyouts) change the company's actual value and can hold a repricing. Soft catalysts (a vague partnership PR, a sympathy move off a peer's news) fade more often than they follow through. Checking the 8-K or press release itself, not just the headline, is the difference between trading the news and trading the rumor.