This is a re-published, popular Blog…

When talking stocks, you will sometimes here a professional trader or broker refer to “the TICK.” The TICK refers to an intra-day index which measures the number of stocks rising on up-ticks versus those that are falling on downticks. A tick is the price-point where the next trade goes off.

Example:  XYZ stock trades 100 shares at 9:30:35 am at $10.05….and a couple minutes later (say 9:32:37 am), the same stock trades 200 shares at  $10.09…or 4 cents higher. That is called an up-tick. If the same stock then makes its next trade at, say 3 cents lower, then that is a down-tick.

You can view a version of the intra-day $TICK chart on my public chart list at www.stockcharts.com under the name of AceStockTrader. 

Yes, TICK can be charted…I  prefer the 5 min and 15 min TICK charts…and I also have a daily and weekly version I like which I will show another time. On my TICK charts, I have an orange and green horizontal line. The green line is usually set at +600 and the orange line at -800. When TICK crosses either line, that is considered an overbought or oversold condition. What TICK represents are the number of upticks vs the number of downticks on the NYSE at any given point in time. When the TICK count is positive, that means that more stocks are trading higher than lower at that given moment….and vice versa when you see a negative number. Generally, you might see the TICK spike up past +600 or down past -800 only a few times a day…

TICK can swing wildly at times, and so it may seem to be difficult to parse out a pattern from TICK….this is why my recent TICK charts show moving average lines in them to spot changes in trend and direction…on the 5 min chart, I favor the 21 period line, which is basically an average for the last 105 minutes…and recently, I added an 8 period line to try and discern an early change in direction…the 8 period line is there to spot changes before they become clearly apparent to other traders.

Richard Arms, the inventor of the TRIN index has recommended using TRIN in conjunction with TICK….TRIN shows the underlying behavior of large traders such as hedge funds and mutual funds. TRIN helps one to spot these hidden trends which may be diverging from what the general indexes show, at times. TICK is a confirmation tool to discern that what we might see with TRIN is truly happening. TRIN is basically reflective of a ratio formula, and at certain times, the ratio can fool the unknowing trader….TICK helps one to confirm that what they might see in TRIN action is true….if TRIN shows strong buying but TICK is negative, this might mean that the ratio on TRIN is mis-leading at that moment in time.

Now, back to the MA lines on TICK….generally, when TICK 21 MA reaches about -300, it has been my experience that most of the selling is done on the NYSE, and often what happens is that a bounce ensues and catches the unknowing BEARS off guard….

TICK can also help you spot divergences in the trading day…TICK migsl
Vice versa, when TICK reaches about +350 or +300 on the 21 period MA, that usually means that the last buyers are coming in (those ill-fated retail traders!), and that’s usually a good time to take profits and exit the trades–the 21 MA line works much like an oscillator for the trend and direction of the major stock market…..

When I was not working in Corporate America, I had a lot more time to watch TICK and take those profits every time it crossed up near +300…and close those bearish positions when TICK reached -300….sadly, I don’t have time to trade like that now…relying much more on the daily for that, but in this market, I have been whip-sawed a lot by trying to trade more methodically off of dailies…this has been a fast moving market that favors day-traders, not swing traders, imho.

However, for the day-trader or the swing trader who is looking for more precise entry and exit points, the 5 minute TICK in conjunction with the 21 period line can provide valuable insight into when to load up and when to exit fast moving trades. ACE

When talking stocks, you will sometimes here a professional trader or broker refer to “the TICK.” The TICK refers to an intra-day index which measures the number of stocks rising on up-ticks versus those that are falling on downticks. A tick is the price-point where the next trade goes off.

Example:  XYZ stock trades 100 shares at 9:30:35 am at $10.05….and a couple minutes later (say 9:32:37 am), the same stock trades 200 shares at  $10.09…or 4 cents higher. That is called an up-tick. If the same stock then makes its next trade at, say 3 cents lower, then that is a down-tick.

You can view a version of the intra-day $TICK chart on my public chart list at www.stockcharts.com under the name of AceStockTrader. 

Yes, TICK can be charted…I  prefer the 5 min and 15 min TICK charts…and I also have a daily and weekly version I like which I will show another time. On my TICK charts, I have an orange and green horizontal line. The green line is usually set at +600 and the orange line at -800. When TICK crosses either line, that is considered an overbought or oversold condition. What TICK represents are the number of upticks vs the number of downticks on the NYSE at any given point in time. When the TICK count is positive, that means that more stocks are trading higher than lower at that given moment….and vice versa when you see a negative number. Generally, you might see the TICK spike up past +600 or down past -800 only a few times a day…

TICK can swing wildly at times, and so it may seem to be difficult to parse out a pattern from TICK….this is why my recent TICK charts show moving average lines in them to spot changes in trend and direction…on the 5 min chart, I favor the 21 period line, which is basically an average for the last 105 minutes…and recently, I added an 8 period line to try and discern an early change in direction…the 8 period line is there to spot changes before they become clearly apparent to other traders.

Richard Arms, the inventor of the TRIN index has recommended using TRIN in conjunction with TICK….TRIN shows the underlying behavior of large traders such as hedge funds and mutual funds. TRIN helps one to spot these hidden trends which may be diverging from what the general indexes show, at times. TICK is a confirmation tool to discern that what we might see with TRIN is truly happening. TRIN is basically reflective of a ratio formula, and at certain times, the ratio can fool the unknowing trader….TICK helps one to confirm that what they might see in TRIN action is true….if TRIN shows strong buying but TICK is negative, this might mean that the ratio on TRIN is mis-leading at that moment in time.

Now, back to the MA lines on TICK….generally, when TICK 21 MA reaches about -300, it has been my experience that most of the selling is done on the NYSE, and often what happens is that a bounce ensues and catches the unknowing BEARS off guard….

TICK can also help you spot divergences in the trading day…TICK might begin to rise before the major indexes such as the Dow or NYA begin to move…or vice versa. Like TRIN, it captures the movements behind the scenes among all NYSE stocks even as big cap stocks continue to get propped up to keep the major indexes like the Dow looking  flush.

Vice versa, when TICK reaches about +350 or +300 on the 21 period MA, that usually means that the last buyers are coming in (those ill-fated retail traders!), and that’s usually a good time to take profits and exit the trades–the 21 MA line works much like an oscillator for the trend and direction of the major stock market…..

When I was not working in Corporate America, I had a lot more time to watch TICK and take those profits every time it crossed up near +300…and close those bearish positions when TICK reached -300….sadly, I don’t have time to trade like that now…relying much more on the daily for that, but in this market, I have been whip-sawed a lot by trying to trade more methodically off of dailies…this has been a fast moving market that favors day-traders, not swing traders, imho.

However, for the day-trader or the swing trader who is looking for more precise entry and exit points, the 5 minute TICK in conjunction with the 21 period line can provide valuable insight into when to load up and when to exit fast moving trades. ACE

Are you looking for more insights on TICK and TRIN? Then visit ACE’s message forum where active traders post their trades and thoughts on these subjects and more. The message board is hosted and moderated by ACE.