Monday, October 19, 2009

Dow TICK ($TICKI) and Short-Term Sentiment

The TICK that is specific to Dow 30 stocks ($TICKI, above) moves much quicker than the NYSE TICK, given the fact that the Dow issues trade frequently and are prominent components of baskets of stocks that are involved in program trading. When we see persistent negative readings in $TICKI, with values of -20 and lower, it suggests that multiple large traders are selling baskets of stocks--a nice short-term gauge of shift in sentiment, in the case of the recent market.