Info!! Useful Trading Tools - Occupation One: Nyse Tick

Suppose you lot could follow every unmarried stock listed on the NYSE together with rail every few seconds how many of the stocks were trading on upticks versus how many were trading on downticks.  What would that data tell you?

A buyer who wants to ain shares aggressively volition execute alongside a grade of urgency together with volition pay upwards for those shares.  Such lifting of offers volition drive stocks to merchandise on upticks.

Conversely, a seller who wants out of shares aggressively volition also execute alongside urgency together with volition convey the bid price.  This hitting of bids causes stocks to merchandise on downticks.

By calculating the publish of stocks trading on upticks minus those trading on downticks every few seconds, the NYSE TICK ($TICK on eSignal feed) is an immediate, existent fourth dimension stance survey.  It is based on the actual transactions inwards a wide stock universe together with hence represents what traders are truly doing, non simply what they tell they'll do inwards a survey.

One application of NYSE TICK is to convey the intraday readings together with do a cumulative line, like to an advance-decline line.  As you lot tin run across above, that cumulative trouble has been making fresh bull marketplace highs.  That tells me that marketplace participants remain cyberspace buyers.  Note how selling pressure level was restrained during the most recent marketplace tumble.  That was a dandy tell that the downwards motion was a correction inwards a rising market, non the kickoff of a behave market.

There are many other applications of TICK every bit well.  For instance, since 2012, private readings that piece of job past times close +900 or autumn below -900 stand upwards for 2 amount criterion deviations from average.  That tells us that at that spot is pregnant buying or selling pressure level across the wide stock universe.  Note that such buying or selling has to move wide based, every bit you lot tin exclusively become those extreme readings if stocks beyond the S&P 500 listing are lifting or selling off.  

To become those extreme TICK readings where together with so many stocks are upticking or downticking simultaneously, nosotros demand to run across institutional participants aggressively buying or selling baskets of shares.  That is an first-class stance clue.

For instance, later early on selling that took TICK to the -740 expanse during Friday's session, buyers entered inwards forcefulness together with drove TICK higher upwards +1000.  From that request forward, to a greater extent than stocks traded on upticks than downticks.  That was a squeamish tell for the coming upward tendency day.

And what if NYSE TICK readings remain pretty much betwixt +500 together with -500 for the day?  That is oftentimes a practiced indication that institutions are non participating aggressively together with that at that spot is piffling directional demand or provide for shares.  That tin move a practiced clue alerting us to slower, rangebound trade.

So much of successful short-term trading boils downwards to rapid designing recognition, derived from enough of observation.  I receive got archived one- together with five-minute TICK readings for years together with studied their nuances.  For me, it's been a dandy tool for identifying who is inwards the marketplace together with which means they're leaning.

Further Reading:  Interpreting Markets With NYSE TICK

Info!! What The Cumulative Adjusted Nyse Tick Trouble Is Telling Us

this post for calculation of the adjusted TICK). As nosotros plunged to intraday lows on Oct 10th, nosotros made a depression inwards the cumulative TICK line; equally we've directly moved dorsum to those lows, the line has held at much higher levels inwards a dramatic divergence. What gives?

The TICK is a mensurate of stocks trading on upticks versus downticks. It begins its calculations amongst the showtime of trading inwards NY together with ends when the NYSE closes. As a result, the TICK does non line concern human relationship for activity that occurs overnight, betwixt the USA marketplace unopen together with the side past times side day's open.
If nosotros lead maintain a await at the S&P 500 Index (SPY) from the showtime of September, nosotros abide by that the marketplace lost almost 42 SPY points (approximately 420 ES points). From the showtime of September upwards to that Oct tenth inflection betoken at which the position out of stocks making novel lows hitting its highest grade (see chart), SPY lost 3.29 points betwixt the NY unopen together with the side past times side day's opened upwards together with lost 34.8 points betwixt the NY opened upwards together with close. From Oct tenth forward, SPY has lost 8.46 points during overnight merchandise and, during the 24-hour interval session, has genuinely gained 4.8 points.

The cumulative TICK is capturing the fact that buying trace per unit of measurement area has been exceeding selling trace per unit of measurement area during the 24-hour interval trading sessions from Oct tenth to the present. Indeed, during that time, the S&P 500 Index--if nosotros await at 24-hour interval session only-- has risen inwards value. This is a clear shift inwards authorities together with suggests that weakness inwards equity markets from Oct tenth frontwards has shifted to the European together with Asian markets. That weakness prompts the USA marketplace to opened upwards lower, but has non led to farther internet selling initiated inwards the U.S.

This morning, equally of my writing, we're seeing a potential repeat of this same pattern. Markets were real weak inwards Asia, opened quite weak inwards Europe, together with are trading lower inwards preopening trading inwards the USA stock index futures. We made novel comport marketplace lows overnight inwards the ES futures but, equally I write, are trading most 1.5% inwards a higher house those lows. Should nosotros create value during the regular trading 24-hour interval inwards a higher house these lows, I volition hold upwards leaning to the long side inwards my short-term trading, entertaining the hypothesis that, inwards this alter of regime, the 24-hour interval markets inwards the USA lead maintain already seen their cost lows, fifty-fifty equally markets overall (due to overseas/overnight influence) have been weak.

What prompted this petty investigation was a elementary observation that a growing percentage of my intraday trading profits was coming from the long side, despite the overall weak market. That makes sense, given that many of my trades drive to capture swings inwards the NYSE TICK (i.e., essay out to follow short-term buying/selling sentiment). I volition popular off on to follow these swings inwards early on activity today, amongst a detail pump toward whether nosotros sustain a positively or negatively sloped cumulative TICK line on the day. That volition enjoin us whether USA traders during the 24-hour interval session are using overseas/overnight selling for create out hunting, or whether they are succumbing to the global marketplace weakness.

P.S. - On a related note, Cumulative TICK together with Short-Term Sentiment

Trading With the TICK

Trading Breakouts With TICK
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Info!! Lessons Inwards Trading As Well As Psychology - 1: Government Changes

In this serial of posts, we'll await at ways of integrating trading psychology together with the procedure of trading.  It is my promise that the serial volition illustrate the richness of the human relationship betwixt trading together with psychology--a depth rarely captured inwards traditional writings on the topic.

Here nosotros meet a nautical chart of SPY (blue line; five infinitesimal values) from Dec 15th through this by Friday, Feb 2nd.  In red, nosotros meet a 2-hour moving average of NYSE TICK values over that same period.  Recall that this mensurate captures the position out of stocks trading on upticks minus the position out trading on downticks at each 2nd of the trading day.  The symbol is $TICK on the e-Signal platform together with most others

Note that for a skillful utilisation of the start one-half of the chart, the NYSE TICK values stayed inwards a higher house the goose egg line.  As SPY moved higher, nosotros saw prove of buying strength:  to a greater extent than stocks trading on upticks than downticks.  Look, however, what happened inwards the 2nd one-half of the chart.  The distribution of TICK values shifted together with we instantly saw to a greater extent than selling pressure level than buying pressure--even every bit SPY moved to all fourth dimension highs.

In other words, the psychology of the marketplace changed--we shifted from a buying authorities to a selling one--well earlier SPY made its recent correction.  The alter inwards the distribution of TICK values alerted us to marketplace vulnerability.

Here is an analogy:  suppose the economic scheme of the the US is quite strong inwards large urban areas of the due east together with westward coasts, merely weak everywhere else.  Influenza A virus subtype H5N1 company's sales proceed to rise, merely when administration looks at the distribution of sales, they meet that fewer together with fewer regions are belongings upwardly the rest.  An warning administration would non endure high-fiving over tape earnings.  They would endure reducing production together with shifting the production mix to educate for potential economical downturn.

The psychological takeaway is that nosotros bespeak to drill downward together with await beneath the marketplace surface together with approach each fresh laid of information amongst an opened upwardly mind.  On the solar daytime nosotros made a peak inwards SPY, nosotros had 599 stocks brand fresh 3 calendar month highs together with 199 register novel monthly lows.  Two weeks earlier that, nosotros had virtually 900 novel 3 calendar month highs against 135 lows (data from Barchart.com).  The opened upwardly heed respects toll activeness together with marketplace strength, merely also is warning to cracks beneath the surface.  Then, when toll tin no longer sustain novel highs, volatility increases, together with TICK readings instruct real negative, that alertness allows for a quick transition to the novel regime.

You direct keep to direct keep the right information, together with you lot direct keep to direct keep the right mindset of openness.  That is an of import agency that trading together with psychology come upwardly together to exercise success.

Further Reading:

  NYSE TICK every bit a Useful Trading Tool

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Info!! Is The Supplemental Liquidity Provider (Slp) Plan Affecting Merchandise Inwards The Stock Market?

the increased frequency of herding days inwards the stock market. Also for review is the postal service that highlights the NYSE TICK equally a mensurate of institutional sentiment. The Zero Hedge spider web log noted the shift inwards the NYSE TICK slow yesterday as well as attributed the before buying forcefulness to algorithmic trading, specifically the plan trading associated with the NYSE's Supplemental Liquidity Provider plan (SLP), much of which can live on attributed to Goldman Sachs. More on SLP tin give the sack live on constitute here.

I holler upwards Zero Hedge is on to something, only I suspect there's to a greater extent than to the storey than the directionality of TICK values. If the distribution of TICK values is elevated over time, it agency that programs are existence executed with an upward directional bias. SLP is supposedly a non-directional marketplace making program; if it were genuinely run inwards that manner, it should non persistently lift or depress TICK, since the marketplace making would live on a two-sided trade.

However, if marketplace making programs were unusually influential inwards the marketplace, nosotros should await to run into a higher measure divergence of TICK values. That is, to a greater extent than baskets executed should yield a wider variability inwards one-minute ranges of TICK readings. Those tracking TICK should run into a large release of elevated TICK readings amongst a large release of depressed readings, equally the liquidity provider(s) operate on both sides of the marketplace executing their handbasket trades.

Recently, this increased variability of TICK readings (along with elevated book inwards the ES contract) is exactly what we've been seeing during slow hateful solar daytime trade. The higher upwards nautical chart provides an example from yesterday's trade, with a moving 20-minute measure divergence of one-minute high-low-close NYSE TICK readings. Notice how nosotros larn to a greater extent than programs executed equally the session moves toward the New York close. Unlike the readings from before inwards the day, which were skewed positively, the slow hateful solar daytime readings featured many extreme one-minute readings on the purchase as well as sell side--precisely what you'd await if marketplace makers were active inwards plan trading.

A quick disclaimer: I am a psychologist who plant with hedge fund portfolio managers, banking concern traders on proprietary desks, as well as proprietary trading firms; I brand no claim to expertise when it comes to the microstructure of the market. Nor practise I receive the macro perspectives of my company fighting colleague from Zero Hedge. What I tin give the sack order you, equally ane who trades as well as plant with active intraday traders (including several that concern human relationship for a meaningful per centum of sum book inwards the CME S&P 500 (ES) e-mini contract), is that the slow hateful solar daytime merchandise has changed lately as well as those changes accept guide affected active marketplace participants. Those changes include increased herding demeanour (a historically odd release of days skewed toward buying or selling) as well as increased marketplace book as well as volatility during the concluding hr of trading.

My sense, from the information higher upwards as well as my observations of the market, is that plan trading has been affecting this market, only the impact appears to live on peculiarly concentrated slow inwards the trading day. If SLP were providing supplemental liquidity throughout the day, ane would await a full general tiptop of the TICK measure divergence compared with, say, a twelvemonth ago. My analysis of historical information suggests that that has non occurred. Rather, it appears that liquidity providers are exploiting anomalies that happen toward the cease of the day. I suspect these anomalies are related to 3 factors:

* Increased participation of proprietary (directional) traders who typically encompass their positions past times the marketplace close;

* Increased intraday administration of positions as well as portfolios past times portfolio managers hesitant to concord overnight risk, given the diminished gamble appetites of investors;

* Portfolio rebalancing amid increasingly pop leveraged index ETFs, which may amplify existing directional moves.

Given the concentration of this plan action inwards the concluding hour, a skeptic powerfulness live on led to conclude that this trading is to a greater extent than designed to assist the liquidity of participating trading firms than the liquidity of the marketplace. There is zip incorrect with this--unless the action is funded inwards business office or whole past times a stock central working inwards conjunction with fiscal institutions backstopped past times the government, creating a less than grade playing plain for independent traders as well as investors.
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Info!! U.S. Tick: Tracking The Stock Marketplace Past Times Tracking The Marketplace Of Stocks

Yesterday's trading session was interesting inward that nosotros started amongst early on weakness, experienced a selloff that failed to intermission final week's lows for most stocks, together with thus rallied dorsum to the opened upwards earlier breaking out together with moving steadily higher.  Yesterday's post illustrated how nosotros tin runway such shifts inward forcefulness past times identifying the break of stocks making fresh intraday highs vs. lows.  

If you lot click on the nautical chart above, you'll come across the ES futures plotted against five-minute average values of upticks vs. downticks for every unmarried U.S. stock.  This is like to the NYSE TICK measure that I accept written nearly inward the past, but amongst 1 of import difference:  it tracks all stocks, non just those listed on the New York Stock Exchange.  For that reason, this U.S. TICK mensurate is peculiarly skillful at capturing the forcefulness together with weakness of the wide marketplace 2nd past times moment.  (U.S. TICK readings obtained via e-Signal platform).

(A theme for just about other twenty-four hours is a comparing of readings for NYSE TICK together with U.S. TICK every bit a agency of gauging the relative buying/selling involvement inward smaller cap stocks.  During the recent menstruation of Russell 2000 weakness, the relative ratio of U.S. TICK to NYSE TICK was an splendid say together with helped amongst trading IWM.  It is very of import to continually nowadays inward trading together with discovery sources of information that confer an edge.  I backtest a lot of marketplace information together with accept never constitute criterion indicators--particularly the presets on trading apps--to last especially predictive.)

Notice how downticks dominated upticks early on inward the session, alerting us to early on weakness despite the fact that the marketplace was upwards from Friday's open.  We sold off difficult inward the morn together with then, from slowly morn forward, something interesting happened:  upticks on the twenty-four hours began to outnumber downticks.  We tin come across this visually past times looking at the expanse of the nautical chart that U.S. TICK spends to a higher house together with below the goose egg business or nosotros tin practise a cumulative business for the U.S. TICK.  Either way, what you'll come across is that the distribution of U.S. TICK values shifted during the day--in advance of the market's upward break.  Buyers began to dominate sellers.

Any private value for the U.S. TICK tin last high or depression depending on random flows of the moment.  When nosotros come across an ongoing shift inward the distribution of values over time, however, that tells us that the dynamics of the marketplace accept altered.

There is yet just about other agency to position shifts inward supply/demand inward the stock market:  When you lot report the distribution of U.S. TICK values over time, you lot know the levels that stand upwards for 2+ criterion deviations inward the positive together with negative direction.  These important TICK levels say you lot when at that spot is a meaningful surge inward the participation of buyers or sellers.  Note that nosotros saw just such a surge during the noon hour, 1 time again inward advance of the market's cost breakout.  Following the breakout, nosotros saw additional surge values to the upside, confirming that buyers were inward control.  Knowing this tin deal a trader avoid selling a steamroller market.

We tin follow the stock marketplace through indexes such every bit the ES futures, but measures such every bit U.S. TICK present us that it is too a marketplace of stocks.  By tracking inward existent fourth dimension what every stock is doing, nosotros hit a perspective on marketplace forcefulness together with weakness that is non possible but past times next a unmarried index of capitalization-weighted large caps.

Further Reading:  More on Indicators together with Trading Patterns Can Be Found Here
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Info!! Useful Trading Tools - Business Office Five: Dow Ticki

Past posts inwards this serial accept looked at stock marketplace breadth, unique information visualization, volume information, together with the NYSE TICK.  In this adjacent serial post, we'll hold back at the Dow Jones Industrial Average equivalent of the NYSE TICK:  the TICKI.

TICKI represents the publish of Dow xxx shares trading on upticks vs. those trading on downticks at each minute of the trading day.  Its distribution is far noisier than NYSE TICK, every bit the Dow shares merchandise often together with often every bit business office of handbasket trades executed past times institutions.  Indeed, i of my favorite uses of TICKI is to evidence the frequency of extreme values:  +20 or inwards a higher house vs. -20 or below.  For a cracking bulk of Dow stocks to endure upticking or downticking at the same time, at that topographic point must endure baskets of trades hitting the marketplace on the purchase or sell side.  This is a overnice agency of tracking the thought of large marketplace participants.  If nosotros run across many meaning positive readings, nosotros know they are lifting offers together with executing on the purchase side; many meaning negative readings suggests a hitting of bids together with selling pressure.

Because TICKI is together with then noisy inwards its minute to minute readings, I proceed a cumulative amount of the one-minute average high-low-close readings.  That TICKI Sum stair out is depicted above, relative to yesterday's S&P 500 Index (SPY).  What you lot tin forcefulness out run across is a persistent bid to large cap shares through the session, fifty-fifty every bit the NYSE TICK was flattish to downward on the session.  Buy programs inwards the large caps were going off, exactly the buying was non across the wide stock universe.  That was a overnice nation for a mixed market.  It was also why I didn't believe we'd sell off significantly during the 24-hour interval session.

There are many uses of NYSE TICK together with Dow TICKI data.  For instance, real short-term intraday traders tin forcefulness out role pullbacks inwards these measures to tending fourth dimension the execution of purchase together with sell trades.  In an uptrend, you lot desire to purchase pullbacks inwards TICK together with TICKI--especially when you lot run across pullbacks occurring at higher cost levels.  The opposite logic applies to downtrends.  When you lot run across real few meaning high together with depression readings, you lot know that institutional players are non dominant inwards the marketplace together with nosotros are much less probable to accept a volatile, tendency day.

Among the high frequency information available to traders, I discovery the TICK together with TICKI to endure most useful inwards gauging marketplace participation together with sentiment.  Somewhat related information is also establish inwards the Market Delta measure, which I'll endure writing close shortly.

Further Reading:  Dow TICK together with Market Patterns

Info!! 3 Basic Merchandise Setups

So much of trading success is a purpose of blueprint recognition, together with hence many trading patterns boil downwards to 3 basic setups:

1) Reversal Trades - The marketplace seat moves to or but beyond the edges of a trading attain (a consolidation area, the value expanse from the prior day), cannot sustain buying/selling interest, together with falls dorsum into that range. The initial target for such a merchandise volition mostly endure the amount of that attain (which may too endure the pin level from the previous twenty-four hr menstruum or week); a reversal on skillful book together with really weak/strong NYSE TICK volition oft exam the reverse terminate of that range, equally the breakout traders bail out of their positions. I similar to endure especially on the sentry for reversal trades inwards environments inwards which relative volume is weak, equally these tend to endure markets that volition endure pushed some past times marketplace seat makers, non longer fourth dimension frame participants. (Relative book parameters tin at in 1 lawsuit endure institute inwards my Mon AM indicator updates).

2) Breakout Trades - Here nosotros bring a province of affairs inwards which the marketplace seat is attain saltation (note the electrical flow multi-day trading attain inwards SPX) together with surges out of the range, mostly on enhanced book together with really high/low NYSE TICK levels. Very often, in that location volition endure a catalyst for the breakout (economic news; earnings) together with the motility volition endure reflected past times other trading instruments and/or property classes. For instance, if an economical written report leads to repricing of other markets (interest rates; currencies), the chances are skillful that a simultaneous breakout inwards stock prices is real. The initial targets for breakout moves volition endure the daily cost targets (R1, R2, R3; S1, S2, S3) that I distribute each AM prior to the marketplace seat opened upward via Twitter (my Mon AM indicator reviews.

3) Continuation Trades - Here nosotros bring a tendency already inwards place; the thought is to hold back for a describe dorsum to motility into the trend. Influenza A virus subtype H5N1 skillful continuation merchandise tin endure thought of equally a merchandise that has already broken inwards a higher house or below its recent pin level, striking its R1 or S1 grade relatively quickly, together with at in 1 lawsuit is positioned for possible moves to R2/R3 or S2/S3. We tin too intend of a continuation merchandise equally a strong daily motility that is moving toward a weekly cost target equally a profitable swing trade. Influenza A virus subtype H5N1 skillful continuation merchandise volition demo book expanding inwards the administration of the tendency together with contracting on pullbacks. There volition too endure a trending cumulative NYSE TICK together with Market Delta; pullbacks inwards TICK together with Delta volition serve equally potential entry points. For instance, if nosotros striking R1 together with and then describe dorsum on lite book together with exclusively modestly negative NYSE TICK together with Delta, nosotros could reload on the long side for a continuation motility to R2.

I promise to illustrate each of these 3 basic setups inwards futurity posts and, equally yesterday, warning readers to their appearance via Twitter updates early on inwards trading sessions. The virtually recent v Twitter posts appear on the spider web log page nether "Twitter Trader"; the consummate listing of posts appears on my Twitter page. Links for subscription to the spider web log via RSS tin endure institute below the "About Me" department of the spider web log page.
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Info!! Passing The Plate: Integrating Time, Price, In Addition To Volume

The adjacent inwards the serial of "passing the plate" posts comes from SSK, who maintains a real useful together with educational trading site. His analyses depict upon Market Profile theory together with bully observation of time, price, together with book to select grip of shifts inwards bespeak together with supply.

SSK's explanation, along amongst his graphics above, volition accept a trivial study, but the endeavour volition pay off. If you lot click on each graphic, you'll hold upwards able to read SSK's information together with commentary. Here is the explanation of his setup:

"In this trade, after recognizing a potential brusk close the high of 9/17/2009 inwards the 1068 area, I was looking for continuation to maximize my merchandise together with was too looking for a transitional state to permit for potential profit-taking. The Profile from 9/16/2009 (top chart) identifies a depression or negative book surface area (1055-1058) that many times, every bit cost reaches this area, acts every bit initial back upwards or resistance. That was my reference point. When cost reached this area, I went to my NYSE tick nautical chart together with looked at its structure. I saw a momentum depression inwards price, together with and then a few minutes after a lower depression inwards cost (this is a transitional pattern), during which the NYSE tick was gaining forcefulness correct at the secondary depression (middle chart). Additionally, the NYSE Composite book that I runway on my spreadsheet too showed the book together with directional trends weakening every bit nosotros approached the reference betoken (bottom chart). All inwards all, a prissy drib dead on the brusk merchandise from the highs inwards the 1068s for 10 points, together with a prissy entry on the long side from the 1058s, amongst an drib dead close the POC (point of control) close the 1063s for v points. The cardinal was to commencement position the reference betoken together with and then discover the transitional construction via the NYSE tick together with NYSE Composite volume."

What is clear from SSK's analysis is that he is non only relying upon marketplace position indicators, but rather on configurations of indicators that expose the developing forcefulness together with weakness of markets. In therefore doing, he is able to capture larger moves together with innovation out his merchandise every bit it emerges. Many thank you lot to SSK for the illustration; check out his site for to a greater extent than marketplace position insights.
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Info!! Using The Short-Term Moving Average Of Nyse Tick To Merchandise Arrive At Days

The previous post showed the distribution of the 10-minute moving average of the NYSE TICK during an uptrend day. Today (above) nosotros saw a really unlike market.

One of the most of import tasks for a daytrader is to identify, equally early on inward the hateful solar daytime equally possible, the probable hateful solar daytime structure. That agency trying to differentiate a probable tendency hateful solar daytime (i.e., ane that volition unopen far from its opened upwards together with close its high or depression for the day) from a non-trending hateful solar daytime (one that trades inside a range). I detect the distribution of the NYSE TICK, which continuously measures the set out of stocks trading on upticks vs. downticks, to hold upwards quite useful inward that regard.

On a candidate tendency day, I desire at to the lowest degree a slice of my working capital missive of the alphabet entering inward the direction of the tendency early on inward the hateful solar daytime together with riding the deed throughout. On shorter-term trades, I volition merchandise close solely inward the direction of the trend, entering on countertrend moves inward TICK.

On a candidate hit day, I desire to hold upwards equally nimble equally possible. Very often I'm buying pullbacks inward TICK together with selling bounces. Not infrequently, we'll run into "support" together with "resistance" levels for the TICK MA on hit days, equally both buying together with selling are relatively contained. That showed upwards today, amongst most bounces together with dips contained inside the hit of +400 to -400. Because I'm non expecting a trending move, I'm quicker to receive got profits on a hit day: buying when the TICK MA goes negative together with selling when it goes positive often provides a proficient short-term trade.

When nosotros run into relatively constrained values--upside together with downside--for the TICK MA during the starting fourth dimension hr of trading, together with when nosotros run into the TICK spending a relatively fifty-fifty sum of fourth dimension higher upwards together with below its naught line, that's when nosotros laid about to recollect of the hateful solar daytime equally a candidate hit day. False breakout moves are mutual on those days. Knowing that nosotros were inward a hit environment, for instance, helped move past times along me from selling the cost lows a fiddling afterward 1 PM CT.

For reference, the 10-minute moving average of TICK shown higher upwards comes from e-Signal data; it is a elementary 10-minute moving average of the one-minute high/low/close values for TICK. The nautical chart is inward Excel, exactly the TICK MA tin hold upwards charted conduct inside e-Signal.
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Info!! Useful Trading Tools - Business Office Two: Volume

The starting fourth dimension postal service inward this series covered the NYSE TICK together with how it offers insights into who is participating inward markets.  In this post, we'll direct keep a human face at what tin sack hold upwards learned from raw book data.

The inward a higher house nautical chart covers today's trading inward the belatedly forenoon inward the S&P 500 e-mini (ES) futures.  Notice how nosotros were trading inward a narrow make for much of the fourth dimension alongside book averaging nearly a brace chiliad contracts traded per minute.  At 11:49 AM, nosotros got a menstruation to the upside, alongside over 9400 contracts traded that minute.  NYSE TICK hitting a high of 587 during that infinitesimal together with nosotros traded correct dorsum into the make subsequently.

What did that nation you?

Buyers came inward together with couldn't elevator the marketplace position higher.  There was a relatively large buying flow, but it could non heighten the TICK to statistically important levels.  That tells us that the buying was non heavy across the total stock universe.  It was aggressive buying (significant volume), but it could non generate important directional movement.  

Not a bad slice of marketplace position information.

Sure enough, at 11:58 AM--just nine minutes later--the ES contract prints over 9900 contracts during the infinitesimal together with volatility expands, breaking us out of the range.  Moreover, NYSE TICK plunged to -797 together with and then to -997 the next minute.  That is significantly wide selling on important marketplace position volume.  

In Market Profile terms, nosotros direct keep rejected value inward the prior make together with at i time are trending to institute a fresh, lower value area.  The fact that the displace out of the make occurred alongside significant, wide marketplace position participation is an indication that directional participants direct keep taken command of the market.  As yous know from the ease of the hateful solar daytime session, they did indeed direct keep command together with nosotros shut nigh the lows of the day.

It is mutual for traders to advert to the minute-by-minute drive of the marketplace position equally "noise".  For those who sympathise the dynamics of toll action, however, at that topographic point tin sack hold upwards of import signals amidst the noise.  When nosotros direct keep depression to average volume, nosotros know that marketplace position makers are dominant together with directional participants are relatively inactive.  When nosotros direct keep significantly expanded volume, nosotros know that directional traders direct keep taken the marketplace position reins together with nosotros tin sack suit expectations accordingly.  Influenza A virus subtype H5N1 meaningful shift inward book is ofttimes a overnice nation for meaningful shifts inward trading patterns.

Further Reading:  Relative Volume together with Volatility

Info!! Trading Notes: Calendar Week Of November 9Th

Friday, November 13th

*  We started Th weak but non yet at levels corresponding to intermediate-term oversold.  The resulting strategy of selling bounces that could non get got out prior (overnight) highs worked really good during the day, equally nosotros shut weak together with right away get got traded lower during overnight hours. As I mentioned a piece ago, I'm impressed  yesteryear the fact that many marketplace moves are offset during London hours together with non during the U.S. twenty-four hours session.  My working hypothesis is that moves inwards stocks *will* endure anchored inwards London during periods inwards which the top dog drivers of stock prices are macro-related.  Recently, the merchandise inwards stocks has been less nigh turn a profit together with U.S. economic scheme together with to a greater extent than nigh currencies, involvement rates, together with cardinal banking concern dynamics.

*  With the recent weakness, we're much closer to intermediate-term oversold levels per the nautical chart below, but non quite at that spot across many indicators I track.  The opportunity with selling the bounces downward hither is that the short-covering rallies tin endure to a greater extent than violent.  Waiting for short-term overbought weather condition that come about at lower highs together with beingness nimble on exits makes feel equally a twenty-four hours timeframe strategy.

*  One implication of the macro driver thought to a higher house is that tracking how other, correlated assets are trading (commodities, USD, rates, etc.) tin give about clues equally to how stocks may bear going forward.  The higher rates, stronger dollar, weaker commodity province of affairs has non been practiced for stocks.

Thursday, Nov 12th

*  I'm spending the twenty-four hours at the trading desk accompanying a really accomplished trader.  Will most probable alive tweet marketplace observations.  Stock Twits handle is @steenbab.

*  We've made a twosome of attempts to bounce off Monday's lows together with none get got been sustained.  Indeed, my breadth measures get got modestly deteriorated during that fourth dimension together with I'm soundless non showing us at levels that get got corresponded to intermediate-term oversold conditions.  All that suggests to me that nosotros are vulnerable to a downside break.  My leaning is to sell bounces that cannot get got out the overnight highs.

*  In general, nosotros tend to run across elevated levels of pure volatility (volatility per unit of measurement of marketplace volume) at marketplace lows together with depression levels at marketplace peaks.  Interestingly, we're much closer to levels associated with tops than bottoms.

*  I snuff it along to endure impressed yesteryear how the vigorous rally inwards stocks has seemingly hitting a wall inwards the wake of rising rates together with a stronger dollar.  That dynamic is really much on my radar.

Wednesday, Nov 11th

*  Tuesday attempted follow-through on Monday's selling, but at that spot were divergences with the sectors relative to beingness able to suspension Monday's lows.  The SPX held to a higher house those lows inwards a marketplace noted yesterday to endure short-term oversold.  That led to tardily twenty-four hours buying which has continued overnight.  I'm viewing this equally business office of a topping procedure together with would endure surprised to run across a strong, fresh bull leg here.  Buying weakness that holds to a higher house overnight together with previous day's lows inwards anticipation of testing recent highs makes feel equally a short-term strategy.  I would lighten upwards on pull that leaves us with upside divergences.

*  Where I'm finding about of the best short-term trading opportunities inwards the stock indexes is when nosotros acquire overbought or oversold weather condition followed yesteryear an inability of stocks to snuff it along their upward or downward trajectory.  At such points bulls or bears are committed together with the marketplace cannot displace farther inwards their direction.  That leads to selling or curt roofing that benefits traders buying at the oversold points that can't snuff it lower or selling at the overbought points that can't snuff it higher. 

Tuesday, Nov 10th

*  Monday's marketplace was anything but rotational, equally early, wide selling persisted through the morning. An of import agency of recognizing such a shift is yesteryear tracking the early on distribution of NYSE TICK values, which justice the give away of upticks versus downticks with all NYSE shares.  When that distribution is skewed to the downside together with SPX stays persistently below its opening cost fifty-fifty during periods of upticking, it's an early on sign that sellers are inwards control.  Another "tell" for weakness is tracking how the diverse sector ETFs are trading relative to their opening prices.  If they are dominantly trading downward from their opens together with advance-decline numbers are weak, you lot know that this is a broader selloff together with non business office of mere rotation.

*  The selling has left us short-term oversold, with fewer than 20% of SPX shares trading to a higher house their iii together with 5-day moving averages.  It is non at all odd to acquire a bounce from such oversold levels.  Should nosotros exam yesterday's lows, I volition endure watching breadth together with TICK values closely to run across if selling pressure level is continuing or waning.  Meanwhile, nosotros are non oversold on an intermediate-term basis, per the nautical chart below, which tracks the give away of SPX stocks making fresh 5, 20, together with 100-day novel lows.  (Raw information from Index Indicators).  My working assumptions are that this correction has farther to snuff it but too that the bull leg from tardily September has farther to go.  

Monday, Nov 9th

*  How do nosotros brand changes inwards our lives?  In our trading?  In our emotional responses to trading?  In our relationships?  If it was equally tardily equally setting goals together with motivating ourselves with positive thinking, the psychology together with self-help sections of bookstores would endure quite a fighting smaller.  I believe the recent Forbes post is i of my to a greater extent than of import ones.  The thought is that, inwards a sense, nosotros never actually alter ourselves.  Instead, nosotros larn to supervene upon i laid of motivations--the ones that Pb to undesired actions together with consequences--with an existing, stronger laid of motivations.  In other words, nosotros alter yesteryear acquire to a greater extent than of who nosotros already are.  

*  We snuff it along with a rotational market, with about sectors late potent (financials, little caps) together with others weak (interest charge per unit of measurement sensitive utilities together with consumer staples shares).  (See the graphic from FinViz below).  Across all stocks, however, we're seeing an increasing give away making short-term novel lows.  Fri saw 752 stocks across all exchanges register fresh monthly highs, but too 540 brand novel monthly lows.  That's the most novel lows since early on October.  Longer term, a rotational correction that does minimal harm to the overall indexes would endure a addition for stocks.  Short term, I suspect this correction has farther to go.  My leaning is to sell bounces that cannot get got out prior overnight together with previous day's highs, but I too excogitation to fade weakness that cannot yield fresh cost lows together with expansion inwards the give away of stocks making novel lows.  In short, I'm treating this equally a rotational, attain marketplace until demonstrated otherwise. 

*  Influenza A virus subtype H5N1 large business office of the rotational dynamic, of course, is the recent displace higher inwards involvement rates together with inwards the U.S. dollar on the heels of potent economical numbers together with growing conviction of a Fed charge per unit of measurement hike.  Watching the currency together with rates markets volition endure of import inwards gauging moves for stocks overall together with for the sectors most impacted yesteryear rates.  My best guess is that the markets are doing the Fed's hiking for it, that Dec volition convey an uber-dovish hike, together with that nosotros volition snuff it along with cardinal banking concern dubiety into 2016.  It is non clear to me that the Fed volition wish an extended displace higher inwards the dollar if a destination is to maintain increment together with inflation on target.

Info!! Indicator Update For March 3Rd

my concluding indicator update, I concluded that, "All inwards all, the prove is suggesting an absence of bullish interest, equally observed inwards the NYSE TICK, the weak novel highs/lows, weak momentum, together with tepid AD Lines." This yesteryear week, non much has changed that assessment.

* New Highs/Lows - We tin meet from the hap nautical chart that novel twenty 24-hour interval lows vs. highs convey continued to expand, amongst 395 NYSE, NASDAQ, together with ASE stocks making fresh highs together with 1665 making novel lows. As long equally novel lows are expanding, it is premature to locomote bottom-fishing for anything other than a short-term trade. At a wider fourth dimension frame, nosotros had fifteen NYSE mutual stocks register fresh 52-week highs on Friday, against 99 novel lows. The latter is the highest number of novel lows since the Jan bottom. Among S&P 500 stocks, nosotros had no annual highs on Fri against 26 novel lows; amidst S&P 600 small-scale cap issues, nosotros had two novel 52-week highs together with 37 novel lows. All inwards all, we're seeing a deterioration of strength, though novel lows are good off their real expanded levels from belatedly January.

* Cumulative Adjusted TICK Line - Note from the 2nd nautical chart higher upwards how the recent marketplace bounce was non at all confirmed yesteryear our Cumulative Adjusted TICK Line, suggesting that bullish participation was waning. Since then, we've broken to novel lows inwards the Line, confirming what we're seeing amidst the novel highs/lows. We take away to meet bullish thought sustained earlier nosotros tin set inwards a durable marketplace bottom. The TICK Line bounce from the Jan lows was impressive, but has since faded. My readings from Th together with Fri advise both an absence of buyers (low positive TICK readings) together with an excess of selling pull per unit of measurement area (extreme negative TICK readings).

* Overbought/Oversold - The bottom nautical chart tracks the cumulative draw of piece of occupation for my Demand/Supply Indicator, which has been a real proficient overbought/oversold mensurate of late. We meet deterioration inwards the cumulative draw of piece of occupation inwards keeping amongst the novel highs/lows together with TICK, equally we've entered oversold territory. Note that readings below -30 convey typified recent marketplace lows on a short-to-intermediate term basis; we're currently some -10.

* Advance/Decline Lines - The AD Line for NYSE mutual stocks remains higher upwards its Jan lows, though non yesteryear much. The same is truthful for the AD Line specific to S&P 500 together with NASDAQ 100 stocks, but we're seeing marginal novel lows inwards the AD Line for the S&P 600 small-scale caps together with the broad NASDAQ Composite. This is telling us that small-scale caps convey resumed weakness relative to large caps. All of these lines are inwards downtrends longer-term.

* Momentum - Among S&P 500 stocks, we're seeing 24% trading higher upwards their 50-day moving averages, a pregnant deterioration from the 55% at the recent marketplace peak. Similarly, we're seeing 29% of S&P 600 small-scale cap stocks trading higher upwards their 50-day MAs, downwards from 51% recently. My Demand/Supply mensurate of short-term momentum was real weak on Friday, amongst Demand at 24 together with Supply at 228. It is non at all odd for momentum to striking extremes earlier nosotros meet actual cost highs or lows for a marketplace move.

All inwards all, nosotros dice on to meet deterioration inwards the indicators together with a possible exam of the Jan lows inwards the making. I am non inclined to purchase this marketplace until nosotros meet definitive prove of greater buying interest, momentum, together with strength.
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Info!! Indicator Update For January 20Th

Last week's indicator review concluded that a resumption of the bull motion needed to encounter novel 20-day highs buy the farm on to outnumber 20-day lows together with a resumption of push clit with sectors, coin flow, together with NYSE TICK. "A motion below the 850 percentage inwards the S&P 500 futures would stand upwardly for a violation of of import back upwardly together with would pause the blueprint of higher lows on marketplace pullbacks." We did, inwards fact, larn that pullback below 850, returning us to good within the trading arrive at that dominated during the latter purpose of 2008.

The pullback took us from a highly overbought order inwards the Cumulative Demand/Supply Index (top chart) to a neutral order together with returned us to a province of affairs inwards which novel 20-day lows ane time once to a greater extent than are outnumbering novel 20-day highs with NYSE, NASDAQ, together with ASE issues (middle chart). Sector technical strength has turned negative; every bit I noted inwards my morning time Twitter update today, solely two stocks inwards my handbasket were trading inwards uptrends; xv were neutral; together with 23 were inwards short-term downtrends.

As the nautical chart from Decision Point (bottom) indicates, the advance-decline describe for NYSE mutual stocks is solely modestly off its recent highs. This relative push clit is also reflected inwards a Cumulative NYSE TICK describe that is non far off its recent peak. Selling pressure level has been intense inwards the fiscal sector; the big enquiry going forrad is whether or non this weakness spills over to the wide market. I volition move watching Cumulative TICK closely together with posting to the weblog on the topic every bit ane means of addressing this issue.

In sum, the motion to cost highs early on inwards Jan has been reversed, together with nosotros are dorsum to seeing 20-day lows exceeding novel highs. As long every bit the novel highs/lows rest weak, I aspect continued cost weakness together with tests of the behave marketplace lows. H5N1 motion inwards a higher house the Jan highs, especially on rigid breadth together with with venture expansion of novel highs, would move decidedly bullish. The starting fourth dimension gild of describe concern for bulls is to sustain prices inwards a higher house the weekly pin of 85.19 inwards SPY. Failure to create together with thus targets the weekly S1 order a flake below 80. (Daily, weekly, together with monthly cost targets are sent out via Twitter, along with daily updates of indicators; subscription via RSS is free).
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Info!! Trading Notes: Calendar Week Of November 16Th

Friday, Nov 20th

*  We moved higher during the morning time merchandise on Thursday, staying to a higher house the overnight lows, but thus something interesting happened.  Volume fizzled together with nosotros injure upward with a deadening make day.  This highlights the importance of tracking book inwards existent time.  My favorite way of doing that is with "relative volume":  a mensurate of electrical current book versus the normal book for that item fourth dimension of day.  Below is a nautical chart for yesterday's relative volume.  Values below 1.0 stand upward for subnormal volume.  You tin encounter how book became subnormal every bit the twenty-four hours progressed.  That agency directional participants are taking the sidelines.  And that leads, to a greater extent than oft than not, to make days.

*  The possible skilful tidings is that we're getting depression volume, flattish corrections next moves higher off the recent oversold levels.  That is consistent with the scenario of testing the recent highs together with has me continuing to purchase weakness that stays to a higher house prior twenty-four hours together with overnight lows.  I'm currently working on a suite of innovative bike indicators; every bit y'all tin encounter below, we're coming off an intermediate-term bike depression together with are nowhere well-nigh levels associated with bike peaks.

 Thursday, Nov 19th

*  The strategy of buying weakness that stayed to a higher house the overnight lows--and thus buying weakness that stayed to a higher house morning time lows--worked good on Wednesday, every bit stocks rallied strongly with the unloose of Fed minutes.  We've bounced off oversold levels (see nautical chart below of short-term breadth inwards SPX shares) together with instantly are initiative off to encounter short-term overbought levels.  I move yesteryear away along to aspect a seek of recent highs together with aspect to implement yesteryear buying weakness that stays to a higher house cardinal levels.

*  The unloose of the Fed minutes led to fresh book entering the market, with well-above levels of book for that fourth dimension of day.  Such expansion of book indicates that novel participants ask hold entered the marketplace together with it's cardinal to encounter which way they're leaning, every bit these are to a greater extent than oft than non directional traders running large size. By tracking NYSE TICK, nosotros tin encounter the grade to which the novel book is leaning to the purchase or sell side.  When at that spot is a distinct buying or selling bias with these participants, it tin plough what started every bit a fairly normal twenty-four hours into a robust tendency day. 

Wednesday, Nov 18th

*  We held overnight lows inwards early on merchandise together with moved nicely higher, taking out Monday's highs, but thus cruel dorsum into the make together with ask hold stayed at that spot inwards overnight trading thus far today.  The inability to sustain the forcefulness has me treating this every bit a potential bottoming process, which is clearest when y'all aspect at the Russell 2000 Index together with retail stocks (XRT).  We are oversold on an intermediate-term basis; I'm looking to purchase weakness that stays to a higher house the overnight lows.

*  The aligning of shorter together with longer-term perspectives that I similar is using overnight together with previous day's highs together with lows every bit reference points together with buying weakness that stays to a higher house overnight together with prior day's highs together with lows together with selling forcefulness that stays below highs for the overnight together with prior day's sessions.  When keying off levels inwards this way, it's relatively slow to position halt levels.  Those levels too assist me differentiate cost activity based on U.S. flows from cost activity based on flows from Asia together with Europe.

*  I'm too keeping a unopen optic on commodities.  Hard to believe nosotros tin sustain a wide rally if at that spot continues to endure deflationary dynamics inwards markets.

Tuesday, Nov 17th

*  Once 1 time to a greater extent than nosotros saw a skilful illustration of how flows inwards stocks are alone dissimilar during side yesteryear side fourth dimension zones.  Weakness inwards the index futures when they opened for the weekend was followed yesteryear buying involvement inwards Asian together with European hours together with thus an explosion of buying at the NY open.  The buying occurred on strong NYSE TICK, volume, together with volatility, confirming a rejection of the opening lows together with setting upward an upside tendency day.  Here are four things I aspect for inwards an upside tendency day.

*  What has worked good for me is viewing each of the major fourth dimension periods (Asian trade, European trade, U.S. trade) every bit split days together with non necessarily expecting continuity from 1 fourth dimension menstruum to another.  In a sense, each twenty-four hours offers 3 daytrading periods, with the lion's part of motility inwards U.S. indices occurring during London together with NY hours.

*  Buying involvement has followed through inwards the overnight market; my leaning is to purchase weakness that holds to a higher house the overnight lows.  As mentioned yesterday, my intermediate term measures had non yet reached typical oversold levels; still, given the thrust of the recent displace higher, my leaning is to purpose whatever farther weakness every bit an chance to buy.

Monday, Nov 16th

*  This is 1 of the to a greater extent than of import posts I've written of late together with helps explicate why trying to eliminate our trading mistakes together with bad trading practices is oft the incorrect way to educate ourselves every bit traders.  It too helps explicate why the harder nosotros travail to larn disciplined, the less disciplined nosotros tin become. 

*  Stocks cruel inwards tardily merchandise together with overnight inwards answer to the Paris attacks, but ask hold bounced good off lows every bit I write.  As long every bit nosotros pose inwards lower cost highs, I retrieve it's premature to assume we'll rally only because we've been oversold.  As the posts terminal calendar week indicated, nosotros ask hold non yet been at oversold levels that ask hold of late corresponded with intermediate-term marketplace position lows, per the nautical chart below that tracks novel highs versus novel lows with the SPX shares.

*  My mensurate of pure volatility shows relatively petty spike during this decline compared with the elevated volatility per unit of measurement of book nosotros saw during the August together with September drops.  This would endure consistent with a marketplace position making an intermediate term correction rather than an actual fresh comport leg down.  My base of operations instance continues to endure a seek of the recent marketplace position highs, but it would non surprise me to encounter quite a few divergences on whatever such test.

Info!! The Cumulative Nyse Tick: Selling Thought Prevails Inwards The Stock Market

As readers know, I discovery the NYSE TICK to endure 1 of the almost sensitive measures of buying together with selling involvement on a curt fourth dimension frame. When the TICK is positive, it way that to a greater extent than stocks inwards the NYSE universe are trading on upticks; when TICK falls negative, it way that to a greater extent than stocks are trading on downticks.

By cumulating the one-minute readings from the NYSE TICK, nosotros tin plow over the axe estimate buying together with selling involvement on a longer fourth dimension frame. Above nosotros tin plow over the axe run across that the Cumulative TICK (blue line) has been falling to novel lows along amongst the S&P 500 futures (pink line). Keeping tabs on TICK intraday (whether nosotros convey to a greater extent than readings to a higher house or below the cipher line) has been really useful inwards avoiding bottom line-fishing inwards this market. The Cumulative TICK, similar the advance-decline work (which I'll review inwards Monday's indicator review) has been registering lower highs together with lower lows amongst each marketplace bounce together with subsequent turn down this week, equally lower prices convey failed hence far to attract meaning buying interest.
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Info!! The Psychology Of Trading Without The Ego

A surprising sum of piteous trading comes from trading our egos, non from genuinely trading markets.

When nosotros focus on predicting marketplace moves together with trading our views alongside conviction, trading speedily becomes a game of the ego.

When nosotros declare that nosotros convey a certainly trading "style" together with nosotros hold back for marketplace weather condition to conform our style, trading becomes ego-based.

When nosotros obsessively sentry screens together with focus on each displace of P/L, trading turns into an ego game.

We tin purpose every technique nether the Sun to instill champaign of written report together with overcome emotions, but if nosotros pursue trading through the ego, nosotros volition survive vulnerable.

An analogy I've used inward my books is the expert dancer on a trip the low-cal fantastic floor.  The expert dancer doesn't merely trip the low-cal fantastic his or her manner regardless of the music playing.  The expert dancer does non laid out dancing ahead of the music, anticipating the side past times side tune.  The expert dancer waits for the music to start, catches the crunch together with tone, together with dances accordingly.

In my recent trading, I've been taking ego out of the picture.  I examine a stable lookback menstruation inward the recent marketplace together with position 2 things:

1)  Has at that topographic point been a dominant tendency over that period?
2)  Have at that topographic point been 1 or to a greater extent than dominant cycles over that period?

If I tin divulge no clear tendency or cycles, I don't trade.

If at that topographic point is no trend, but a dominant cycle, I merchandise the hypothesis that this cycle volition conk along into the immediate futurity unless I run across clear changes inward marketplace volume, volatility, intelligence events, etc.  That has me buying prospective cycle lows together with selling highs.  In that regime, I aspect similar a value trader.

If at that topographic point is a distinct trend, but no clear cycle, I purpose the laid out pullbacks/bounces inward the NYSE TICK to displace into together with ride the trend, over again unless I run across clear bear witness of changes inward the market's trading.  In that regime, I aspect similar a momentum investor.

If at that topographic point is a distinct tendency *and* 1 or to a greater extent than dominant cycles, together with therefore I am using the cycles to guide entries together with exits inward the direction of the trend.  In that regime, my execution is counter-trend (value), but the overall thought is trend-based (momentum).

We endure when nosotros hold back markets to merchandise the agency *we* desire them to trade.  There are valuable tools that help us position cycles together with trends.  That enables us to bask the market's trip the low-cal fantastic music--and net income from it.

Further Reading:

Trading Market Cycles

Home Page together with Index

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Info!! Indicator Review For April 28Th

Last week's indicator review noted signs of marketplace strength, only too roughly concerns on the horizon with honor to coin flows into Dow stocks together with the cumulative NYSE TICK. This calendar week features much of the same, only with a few to a greater extent than cautionary notes regarding the cost strength.

The exceed nautical chart requires roughly explaining. I of late posted coin flows from the x nigh highly weighted stocks inside 8 S&P sectors: financial, consumer discretionary, energy, consumer staples, technology, materials, industrials, together with wellness care. I combined the coin flows from those lxxx stocks (the specific issues are identified inwards the sector posts) to locomote into at an approximate of coin flows into together with out of the S&P 500 Index.

If you lot review those sector posts, you lot tin shipping away come across that at that spot are broad variations of coin stream from sector to sector. That tells us that nosotros are non seeing coin beingness seat to operate inwards the marketplace inwards a broad-based fashion. Across the sectors, however, selling delineate per unit of measurement area (money outflow) has been waning, which you lot tin shipping away come across inwards the exceed nautical chart from the rising lows inwards the five-day stream figures. Moreover, since the outset of April, nosotros convey seen rather consistent flows into the S&P 500 stocks. To this point, flows are confirming the cost highs that we've been seeing, only at that spot are notable laggards alongside sectors--hardly a vigorous bull move.

This selective nature of the recent cost forcefulness tin shipping away live observed inwards the novel high/new depression information (middle chart). Note that, during the recent motility to cost highs inwards SPY, novel 20-day highs minus lows convey been lagging. Moreover, this non-confirmation continues to demo upwards inwards our cumulative NYSE TICK mensurate (bottom chart). Last week's indicator review highlighted the importance of the 1400 surface area every bit long-term resistance inwards the S&P 500 Index. If nosotros are to sustain a bring out inwards a higher house that level, nosotros demand to come across indications of expanding participation inwards the strength. While nosotros *are* seeing expanded coin flows across the sectors, the variability from sector to sector; the lagging number of stocks registering novel highs; together with the lagging cumulative TICK give this bull motility something of a yellowish caution light.

Here's a quick await at other indicators together with what nosotros mightiness glean from them:

* Treasury involvement rates convey risen sharply inwards the by week, peculiarly at the curt end. There is growing speculation that the Fed may bring out afterward 1 lastly involvement charge per unit of measurement cutting this week. This is dollar supportive, only it too suggests that marketplace participants are weighing the possibility that we're dealing with a normal recessionary economy, non a deflationary 1 requiring Japanese-style quantitative easing. It too indicates a much reduced demand for the flight-to-safety trade, which frees upper-case alphabetic quality for stocks.

* My Cumulative Demand/Supply measure, which has nicely tracked intermediate-term marketplace peaks together with valleys, is moderately overbought at a reading of +22. Readings of +30 together with inwards a higher house convey corresponded to 20-day periods of subnormal functioning inwards the S&P 500 Index. We hitting that +30 grade dorsum on Apr 18th. Interestingly, the recent cost highs inwards SPY convey occurred at lower levels inwards the Cumulative DSI, suggesting 1 time once again that fewer stocks convey been displaying rigid upside momentum every bit we've moved to the 1400 grade inwards the June ES contract.

* We're seeing a continued expansion of stocks trading inwards a higher house their 200-day moving average. Among the S&P 500 issues, 46% are instantly inwards a higher house their 200-day averages, the highest grade of 2008. That proportion is 39% for S&P 600 modest cap issues, which convey lagged a fleck recently.

* Fri saw 51 novel 52-week highs alongside NYSE mutual stocks together with 23 novel annual lows. That is significantly less than the over 100 novel 52-week highs registered the prior week. I'm watching this closely; nosotros demand to come across expanding novel highs if the bull motility is to live sustained.

* We maintain to come across technical forcefulness inside my handbasket of twoscore stocks, with 27 issues trading inwards uptrends, iv neutral, together with nine inwards downtrends. This is downwards from lastly week's peak, only soundless robust.

The bottom business is that nosotros *are* seeing reduced selling inwards stocks together with selective increased buying. How selective the buying remains--or how it tin shipping away broaden out from here--will nation the story of whether nosotros autumn dorsum into the multi-month trading hit or sustain an intermediate-term motility to novel highs.
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