P1:a/b P2:c/d QC:e/f T1:g
gloss JWBK182-McDowell April 25, 2008 16:35 Printer: Yet to come
Glossary 195P/E ratio Seeprice-to-earnings ratio.
percentage in point (PIP) The increment of movement in the FOREX market.
pit The area where a futures contract is traded on the exchange floor.
playback feature Seebacktesting.
position Your financial stake in a given financial instrument or market.
position trader Uses daily and weekly charts on which to base decisions and
holds positions for days, weeks, or months.
price In trading and investing,pricerefers to the last trade price.
price bar The price bar represents the high and low price behavior in a measured
time interval. Price bars can represent different time frames (intervals) such as
one-minute, five-minute, daily, weekly, and so on.
price oscillator (PPO) histogram This is an indicator based on the difference be-
tween two moving averages, and is expressed as either a percentage or in absolute
terms. The plot is presented as a histogram so that centerline crossovers and diver-
gences are easily identifiable. The same principles apply to the MACD histogram.
price gap Seegap.
price-to-earnings (P/E) ratio The current price of a stock divided by the com-
pany’s annual earnings. One of the most commonly used stock valuation ratios.
profit margin An indictor of profitability. Determined by dividing net income by
revenue for the same 12-month period. Also known asnet profit margin.
put-call ratio The ratio of the volume of put options traded to the volume of
call options traded, which is used as an indicator of investor sentiment (bullish or
bearish).
psychology Mastering the psychology of trading and investing is a crucial part
of becoming successful. The Trader’s Mindset is our definition of what you will
attain when you have mastered your financial psychology. Some of the challenges
in developing strong psychology are overcoming fear, greed, ego, and anger when
trading and investing.
PTP apex The apex always points in the direction of the trend and is the point
of the pyramid (triangle). It will tell you where to enter based on current market
dynamics.
PTP base leg The base leg is the flat base of the pyramid (triangle) and tells you
where you will set your stop-loss exit based on current market dynamics.
PTP confirmed When the market moves beyond the PTP apex in the direction of
the trend, it will be confirmed. At that moment, the triangle will turn eithergreen
orred,depending if it is a bull or bear trend.
PTP minscore This adjustable setting on theARTsoftware determines the num-
ber of pyramids you will see on your chart.