The NYSE Tick Index And Candlesticks

A wealth of information waits to be discovered in the New York Stock Exchange (NYSE) tick index. Its strong
suit is its simple calculation. At any point, this index represents the number of stocks trading on an uptick minus the
number of stocks trading on a down tick. Extreme tick readings of greater than +600 may indicate temporary
exhaustion of buying power, while negative tick readings in the territory of 800 or more can point to a selling climax.

I use these readings throughout the day as an indicator for buy and sell decisions, as well as for recognizing the
continuation of the prevailing trend. The tick index is broadcast throughout the day from most real-time data vendors,including the stock market tape that can be seen on the bottom of the screen during CNBC’s day-time broadcast.The tick index can be enhanced by using technical price pattern recognition, specifically candlestick charts. (See sidebar, “The candlestick method.”) Although I have used numerous other technical studies, combining the NYSE tick index and candlestick charting creates a reliable indicator for signaling turning points in the stock market.

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