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Buzz & Banter



I keep a simple indicator based on the NYSE TICK that sums up the past 13 half-hourly periods (one trading day). This indicator has just gone below zero for the only the fourth time in the past couple of months, as the chart below shows (I placed little green arrows next to the other times we approached zero). This would argue that at some point soon, we will likely see at least a short-term bounce as the dip-buyers try their luck again.

However, as you can also see, on July 2nd the indicator spiked up above +10,000. This is several thousand points above the next-highest reading over the past three years. These types of sustained high TICK readings are usually a sign of exhaustion, especially so far from an intermediate-term low point. So, while we may see a small bounce soon (in fact, we're already getting it into the close), we may have already seen a momentum high and further bounces become questionable as to their sustainability.

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