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Market Internals Vs Price Action, what can be seen from them?
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Market Internals Vs Price Action, what can be seen from them?

  #1 (permalink)
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Market Internals Vs Price Action, what can be seen from them?

Can Market Internals show me something before Price Action, all input greatly appreciated.

$UVOL-$DVOL $TICK(I can see scalping off tick) $ADVN-$DECN $TRIN TRIX I cant get a heads up before Price Action with internals, Am I missing something? Maybe the time frames make a huge difference?

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It's a loaded question to answer IMO, in trying to keep it simple, I would say that Market Internals can be extremely useful in two ways....1) you are always looking for divergence (does the move and direction make sense? ... If you have a breakout above resistance , are key components matching what you are seeing? What sectors are showing strength to support the move? Are financials, Techs, whatever the flavor of the day etc... showing the same or are they being sold into the breakout, what are you seeing to support the move? Where as price action alone is a break above resistance , resistance becomes support or not....) 2. Useful when choosing your entry , exit , let's say you use an RSI on your chart as a comparison, if it's pegged at 100 are you going to jump in and buy? Same goes with $Tick and many others, it may save you a few cents, it may save you much more, it may show you a different picture all together .... these are all just like gauges in your car, the more you have that you know how to read and understand, the more you know what is going on under the hood... but if you say heads up as in predicting or seeing into the future .... waste of time and energy

hope that makes sense and is helpful...

"Successful trading is one long journey, not a destination" Peter Borish Former Head of Research for Paul Tudor Jones speaking on conversations with John F. Carter
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In my opinion, all these indicators are lagging . On the other hand, if you have an open position and would like to know if you can hold on some more then looking at these internals can help you assess the situation.

Now, if you want to develop your skill of anticipation to address the 'before' element of your question then volume is the key. Before any move can take place volume must be present. Price can only move one tick up or down if volume becomes appreciable. To be sure, just look at your most profitable setup(s) along with a volume ladder or the Footprint, you'll quickly realize that volume precedes all moves.


Rad4633 View Post
Can Market Internals show me something before Price Action, all input greatly appreciated.

$UVOL-$DVOL $TICK(I can see scalping off tick) $ADVN-$DECN $TRIN TRIX I cant get a heads up before Price Action with internals, Am I missing something? Maybe the time frames make a huge difference?


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Rad4633 View Post
Can Market Internals show me something before Price Action, all input greatly appreciated.

$UVOL-$DVOL $TICK(I can see scalping off tick) $ADVN-$DECN $TRIN TRIX I cant get a heads up before Price Action with internals, Am I missing something? Maybe the time frames make a huge difference?

As "Ole Blue" eyes said: "You can't have one without the other"

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  #6 (permalink)
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trendisyourfriend View Post
In my opinion, all these indicators are lagging . On the other hand, if you have an open position and would like to know if you can hold on some more then looking at these internals can help you assess the situation.

Now, if you want to develop your skill of anticipation to address the 'before' element of your question then volume is the key. Before any move can take place volume must be present. Price can only move one tick up or down if volume becomes appreciable. To be sure, just look at your most profitable setup(s) along with a volume ladder or the Footprint, you'll quickly realize that volume precedes all moves.

...about as cliche ridden and anachronistic as your moniker!

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GridKing View Post
It's a loaded question to answer IMO, in trying to keep it simple, I would say that Market Internals can be extremely useful in two ways....1) you are always looking for divergence (does the move and direction make sense? ... If you have a breakout above resistance , are key components matching what you are seeing? What sectors are showing strength to support the move? Are financials, Techs, whatever the flavor of the day etc... showing the same or are they being sold into the breakout, what are you seeing to support the move? Where as price action alone is a break above resistance , resistance becomes support or not....) 2. Useful when choosing your entry , exit , let's say you use an RSI on your chart as a comparison, if it's pegged at 100 are you going to jump in and buy? Same goes with $Tick and many others, it may save you a few cents, it may save you much more, it may show you a different picture all together .... these are all just like gauges in your car, the more you have that you know how to read and understand, the more you know what is going on under the hood... but if you say heads up as in predicting or seeing into the future .... waste of time and energy

I see your point, thank you.. Today I had 6 new charts up.... way to much to process along with my normal 3 different time frame screens PA charts. What I did was try to over think each chart to come up with the correct PA direction. I did like the tick the rest not so much.

hope that makes sense and is helpful...


trendisyourfriend View Post
In my opinion, all these indicators are lagging . On the other hand, if you have an open position and would like to know if you can hold on some more then looking at these internals can help you assess the situation.

Now, if you want to develop your skill of anticipation to address the 'before' element of your question then volume is the key. Before any move can take place volume must be present. Price can only move one tick up or down if volume becomes appreciable. To be sure, just look at your most profitable setup(s) along with a volume ladder or the Footprint, you'll quickly realize that volume precedes all moves.

I agree with you on volume I have yet found a vol chart that doesnt give false signals, big spikes means reversals etc, can you share which vol chart you use this would be helpful, I studied better volume for 3 mths couldnt make it read same ever time


tigertrader View Post
...about as cliche ridden and anachronistic as your moniker!

You made me google and think on this one ur first response is where Im at do I just need to stop and watch PA alone and master it? (Im decent now,heard there was 5 stages to becoming a trader 5th stage you just get it, Im knocking on door number 5 looking for final piece) I do use bollinger, along with a 5sma and the bollinger 20sma. I have support/res lines on my chart as PA forms them , sorta went away from pivots except R4/S4. I use 15min,3200tick and a trending 4 range charts thats it.Sometime I glance at a512T...

Suggestions Guys...Any input always appreciated


Last edited by Rad4633; January 18th, 2012 at 11:02 PM.
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GridKing View Post
It's a loaded question to answer IMO, in trying to keep it simple, I would say that Market Internals can be extremely useful in two ways....1) you are always looking for divergence (does the move and direction make sense? ... If you have a breakout above resistance , are key components matching what you are seeing? What sectors are showing strength to support the move? Are financials, Techs, whatever the flavor of the day etc... showing the same or are they being sold into the breakout, what are you seeing to support the move? Where as price action alone is a break above resistance , resistance becomes support or not....) 2. Useful when choosing your entry , exit , let's say you use an RSI on your chart as a comparison, if it's pegged at 100 are you going to jump in and buy? Same goes with $Tick and many others, it may save you a few cents, it may save you much more, it may show you a different picture all together .... these are all just like gauges in your car, the more you have that you know how to read and understand, the more you know what is going on under the hood... but if you say heads up as in predicting or seeing into the future .... waste of time and energy

hope that makes sense and is helpful...

my first reply didnt post to you,so here it is. You seem to always make me think about something I hadnt thought of before like watching leading sectors, but still wouldnt my PA show me what they are doing? divergence I need to watch more, it could give me a heads up. Just when u think ur close the gap widens and more testing begins geez....

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In response, I can only speak for myself and some of the things I have observed or picked up along the way, but I think everyone should use what works for them. But there is a great deal of information available to get an idea of the bigger picture , if that is what you seek. If the market is moving up on defensive stocks (those that may take less of a hit during hard economic times) does the upward trend have staying power? If on the other hand, there is money flowing into small caps and more speculative assets (risk on) there may be another story being told...

here are some suggestions if you'd like to know more about market internals and getting the big picture ....

Stock News & Stock Market Analysis Videos on IBD TV - IBD - Investors.com daily video

Money Flows: Selling on Strength - Markets Data Center - WSJ.com

SentimenTrader Home (subscription required , free 14 day trial )

Market Breadth Definition | Investopedia

https://futures.io/vendors-product-reviews/12050-seeing-there-quite-few-ads.html

Market Summary - Free Charts - StockCharts.com


StockCharts.com Blogs - Don't Ignore This Chart!

http://www.sectorspdr.com/sectortracker/

"Successful trading is one long journey, not a destination" Peter Borish Former Head of Research for Paul Tudor Jones speaking on conversations with John F. Carter

Last edited by GridKing; January 19th, 2012 at 07:41 AM.
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Market Internals


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Here is a small example of how I use market internals when trading ES. The attached image is of 3 charts, top is $DJIA, middle $TICK and bottom is bonds, When trading ES I find that DJIA leads ES by a few seconds to about a 1 minute or so, and the Tick vol does as well. I use these 2 for a market trend direction, on a 1 min ES chart, ( or not if no change is occurring ) and the bonds which move the opposite way usually, as a confirmation that the trend is real and continuing. It takes some screen time to grasp what is happening, and is not to be used a quick-I-can-trade-it indicator. It really works best when a trader is taking the big picture into account. There are some really good writers on this ( big picture) subject here, Josh is one I have seen, and if you chase down those threads, they can write much better than I. Big Mike is also on this issue every where on this site, e.g. you don't need another indicator. So I'm giving you some ideas, but these are not trading indicators per se.
Hope it Helps,

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