Using the TICK and TRIN

K

KiasuTrader

I am an S&P e-mini trader and I use Fibonacci retracements for support and resistance. I usually scalp for 1.5 -3 points a trade.

I have been trying to intergrate the TICK and TRIN into my trading and find them useful, but haven't managed to come up with any solid rules about these yet.

I've mostly been trading them by "feel." I was just wondering if anybody had some useful rules that they'd care to share.

Thanks in advance

Kiausu
 
I don't use it for entries, however I use it to see what's going on. I put the 1,2,3 std deviation Keltner channels for 1000 bars on it, but this is just a fancy way of drawing straight lines. Anyway if you do this you can see that during uptrends or downtrends the ticks will tend to stay on one side of the zero line.
Notice after 1400 (CST) the nq was in a downtrend and the ticks just poked up above zero a few times. On strong trend days it'll stay on one side of the zero line all day. You can use it to time entries this way.
 

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I was using an alert system the other day and ,among other things, it kept alerting "high tick" or "low tick". Now what was I suppose to do with that information?
regards
 
typically in a trending market, you want highs/lows to be confirmed by higher high/lower low in the TICK/TRIN. Today during the consolidation between 12:20 and 13:40, The TRIN kept falling while ES went sideways (turned out to be quite bullish). One trade I like to do during a low volatility day is to go long once ES starts making lower lows while the TICK makes higher lows.
 
Quote from KiasuTrader:

I am an S&P e-mini trader and I use Fibonacci retracements for support and resistance. I usually scalp for 1.5 -3 points a trade.

I have been trying to integrate the TICK and TRIN into my trading and find them useful, but haven't managed to come up with any solid rules about these yet.

I've mostly been trading them by "feel." I was just wondering if anybody had some useful rules that they'd care to share.

Thanks in advance

Kiausu
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KiasuTrader,

The TICK indicator is useful for getting a situational awareness of whats happening in the market. Although I know a few people that use the TICK to set trades up, I personally would not recommend it. They fade the extreme TICK readings and have deep pockets to scale in orders and countertrend trade .

Regarding the TICK indicator, pay attention to the following:


Tick Ranges: The tick has a range of about 1200-1400 top to bottom for the day. This is a relative reading. ex Tick reading 0 - +1200 or -600 to +600. Some days ticks have larger reading than others. One could use this information by having a trade set-up ex. divergence trade and noticing the tick at an extreme. This might give the added confidence to pull the trigger by having the ticks on you side.

TICK Noise : -400 to +400 is a very neutral reading and not significant. Without first setting a TICK range, Ticks that start the day meandering around this level generally mean nothing. Exception: once in a trade you definitely want to see tick moves in your trade direction.

Tick Extremes:+600 +800 +1000 -600 -800 -1000 . occasionally you'll see a tick extreme of +/- 1400 these extremes often set up a intermediate term high or low. Victor Neidorhoffer hedge fund disaster had a -2100 TICK which set an intermediate low. Many traders will simply fade the market and go long at a high negative tick reading -1000. If the tick should retrace back to 0 from -1000 and the ES pops only 1 point you better cover, the market appears very weak.

Closing TICK: The closing tick is often painted by Institutions at days end. If you notice market breadth flat but high closing tick reading this is an indication. Last half hour of the day TICKS get sloppy. This is because of less interest in certain shares make the indicator at days end sluggish

Opening TICK : Wait the first 15 minutes to use this indicator. Not all issues are open on the NYSE hence incorrect TICK reading. be careful!!

TICK relative to Price ESH4: TICK Divergences instead of Momentum trend indicator divergences MACD.

If price make a new high on the day but TICKS do not, you may have a lack of follow through on price. Look to short.

If price makes a new low and Ticks do not confirm with a new low, the ship aint sinking. Look to establish longs.


The TRIN is a breadth indicator. I don't use it for trade set-ups but for generally monitoring buyer and seller interest and participation.


Formula:


advances / declines (issues)
__________________________ = TRIN

advancing volume / declining volume



.80 - 1.20 generally considered neutral

.40- .70 very bullish

1.30 - 2.00 bearish

often times people use this indicator to represent a contrarian indicator. For example .50 as overbought and 1.30 as oversold. Instead of being bullish at .50 they would look to short at these levels.


Regards,
Dave Scott
 
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