Tick Status / Interpretations

[grems8544]

Since I'm becoming increasingly enamored with Billy's tick concepts, and since they have very little to do with GGT, I'm starting this thread here so to keep the tick system and GGT systems separate...

===============

Wednesday was a good day if you follow the intraday tick patterns. I especially like TradeStation's $TIKRL, which is the Russell 2K:



I entered a base short position in IWM shortly after the open, alongside another leveraged position in TZA (not shown), and it was off to the races. I jumped the gun a bit but I saw the TIKRL jump up then promptly reverse, giving me confidence to move into the markets on the short side.

The vertical line corresponds to the 10h MA slope change to the opposing side -- in this case to the downside, so by 10:45 I had further confidence to add to the positions (both -IWM and +TZA). As you can see, the rest of the day was a good day.

I closed all but 100sh of -IWM and +TZA a minute before the close as the markets sold off; depending on today's action I may add to the base positions or I may simply take the remaining profits off the table. We'll see.

The broader $TICK pattern whipsawed then moved aggressively lower on Wednesday, effectively resetting any bullish up leg interpretation:



You can see the extreme selling with the 500 stock / min filter in the middle pane -- this filter is a great way to separate the noise from the real trend and has worked well for me as of late. With all of the slopes of the various tick MAs pointing downward there is no doubt that we are under bearish pressure, despite the futures being up as I write.

The $TIKSP, which tracks the issues in the S&P500, was far more volatile yesterday and I stayed away:



While the slopes of the various MAs are all pointing downward it's important to note that the attempt at buying which started around 2 pm EDT and which lasted an hour would have really challenged you. We did not have a corresponding rally in the other markets in the 2 pm - 3 pm time frame so the buying here was not a reversal. I personally think it was people loading up on dividend paying stocks in anticipation of the end of the quarter, but it's hard to tell for sure. At any rate, I avoided any dabbling in the S&P due to the underperformance relative to the R2K ...

Futures are giving up some of their gains as I write, so it most likely will be another psycho day.

Regards,

pgd