Trivial-threat encounters are so easy that the characters have essentially no chance of losing. They're unlikely to spend significant resources unless they're particularly wasteful. These encounters work best as warm-ups, palate cleansers, or reminders of how awesome the characters are. A trivial-threat encounter can still be fun to play, so don't ignore them just because of the lack of challenge.
Low-threat encounters present a veneer of difficulty and typically use some of the party's resources. However, it would be rare or the result of very poor tactics for the entire party to be seriously endangered.
Moderate-threat encounters are a serious challenge to the characters, though unlikely to overpower them completely. Characters usually need to use sound tactics and manage their resources wisely to come out of a moderate-threat encounter ready to continue on and face a harder challenge without resting.
Severe-threat encounters are the hardest encounters most groups of characters have a good chance to defeat. These encounters are appropriate for important moments in your story, such as confronting a final boss. Use severe encounters carefully—there's a good chance a character could die, and a small chance the whole group could. Bad luck, poor tactics, or a lack of resources can easily turn a severe-threat encounter against the characters, and a wise group keeps the option to disengage open.
Extreme-threat encounters are so dangerous that they are likely to be an even match for the characters, particularly if the characters are low on resources. This makes them too challenging for most uses! Use an extreme encounter only if you're willing to take the chance the entire party will die. An extreme-threat encounter might be appropriate for a fully rested group of characters that can go all-out, for the climactic encounter at the end of an entire campaign, or for a group of veteran players using advanced tactics and teamwork.
