Thursday, November 19, 2009

Midday Briefing for November 19th: Bearish Sentiment

As regular readers know, the NYSE TICK is one of my favorite measures of short-term stock market sentiment. Here we see TICK on a 3-minute basis; note how the bars largely stay below the horizontal zero (purple) line. A quick look at the distribution of TICK values is afforded by the moving average of TICK (blue line), which has stayed below zero through the session, but has recently firmed.

As a rule, values above +800 suggest significant buying sentiment--many stocks upticking simultaneously, a sign of program buying--and values below -800 show significant selling sentiment. In today's trade thus far, we've had no readings above +800, but quite a few below -800. That's a sure sign that institutions--those executing the program trades--have been strongly leaning to the sell side.