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  • Stock Buying Interest: Still a Mixed Picture [View article]
    The author brings up a good point which is often overlooked by those advancing tick analysis as a tool for trading.

    TICK doesn't imapart any information regarding the size of trades involved. A trade of 50,000 shares hitting the bid is a -1 and a trade of 100 shares hitting the ask is a +1. In the calculation of TICK they offset. In reality there is a world of difference. The 50,000 share sell will do much more to drive the bid lower than the 100 share buy will do to drive the ask higher.

    The author is correct to include money flow in his analysis for this reason. Expect event driven knee-jerk reactions in the market for some time to come.

    If you feel you must invest, stick with companies with solid earnings paying a good dividend yield and little or no debt and expect to hang on until the market starts to value these sort of companies too. Long term buying simply to chase capital gains at this point is not worth the risk involved.
    Oct 21 10:42 am |Rating: 0 0
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