TRIN vrs TICK
I am observing the TICK values are currently consistently below zero which is consistent with the current downturn. However the TRIN is below zero and going down. All I have read about TRIN is that if it is below 1 and down trending, that is a positive sign for money coming into the market. There appears to be a divergence between the two indicators. Can someone shed some light on this ?
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Comments
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TRIN is the ratio of net ticks and net volume. It goes above 1 if declining stocks are attracting more volume and below 1 if advancing stocks are attracting more volume. Volume represents conviction.
If the TRIN is moving up while TICK is moving down, it suggests the larger buyers are attracted to the lower prices created by smaller sellers.
Here are the Chart School entries:
http://stockcharts.com/school/doku.php?st=trin&id=chart_school:market_indicators:arms_index
Scroll down for the TICK entry -
http://stockcharts.com/school/doku.php?st=tick&id=chart_school:glossary_t0
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