Updating our TICK Volatility Charts for September

I know, it’s not the most compelling title, but it is very important for all of us to monitor the Volatility or Cycles of Market Internals, especially those of us who use them in our trading or analysis.

Let’s update our TICK Volatility Chart and note the current important intraday levels for trading with the TICK.

To get some background on the chart and the concept of “TICK Volatility,” be sure to read some earlier posts:

“Updating TICK Volatility and the Compressing Range”

“Why You MUST Consider Volatility When Trading with the TICK”

“Research in Behavioral Changes in the TICK Over the Last 10 Years

To keep this post concise, we’ll note that the 20 day average TICK high at the moment is 862 and the average 20 day TICK low is -972.

This is very important if you use arbitrary numbers like 1,000 or -1,000 if you use TICK in your trading decisions.

Sometimes 1,000 is an important number and other times, it rarely occurs (thus you’ll receive no signals).

The red line indicator at the bottom simply measures the change in the average high and average low TICK value (notice how it is cyclical like volatility – we see steady alternation between periods of high volatility and low volatility just like price).

We can actually zoom-in our perspective on the most recent action to make the picture clearer:

Again, the 20 day average TICK high value is 862 (that’s less than the arbitrary 1,000) and -974 (close to -1,000).

Notice also the cluster of lower TICK values and the second lowest TICK reading of the year (-1,420) which occurred on September 4th.

Take a moment to view additional information on the “TICK Volatility” Concept, view any of the prior updates:

• May 2013:  “Weekly TICK Volatility Hits 11 Year Low“
• February 2013:  “Monthly TICK Distribution Chart for January”
• January 2013:  “Intraday TICK High/Low Statistics from 2008 to 2013“
• January 2013:  “Updating TICK Volatility Charts to Start 2013“
• October 2012:  “Updating TICK Volatility for Intraday Traders“
• December 2011:  “Updating TICK Extremes for Trading Reference“

Follow along with members of the Daily Commentary and Idealized Trades summaries for real-time updates and additional trade planning.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter: http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).