Description
The Tiki is not really an indicator (in the sense of moving averages), but it can be used as an indicator when day trading. The Tiki is one of three market internals, with the Trin and Ticks being the other two. The Tiki compares the number of upticking (price increasing) and downticking (price decreasing) stocks in the Dow Jones Stock Index, and calculates a ratio showing whether there are more upticking or downticking stocks.
The Tiki is based upon the stocks that are included in the Dow Jones Stock Index, so it is primarily (actually almost exclusively) used as an indicator for the US markets, but the same principles and formulae can be applied to the European and Asian markets.
The Tiki can be displayed as a single line, or as a bar chart, but it is always displayed on its own chart, separate from the price bars.
Calculation
- Description : The Tiki (T) is a comparison of the number of upticking and downticking stocks.
- Calculation :
T = Upticking Stocks - Downticking Stocks
Note that the calculation of the Tiki is exactly the same as the Ticks, so the only difference is that the Ticks includes all of the stocks that are traded on the NYSE, but the Tiki only includes the stocks that are part of the Dow Jones Stock Index.
Trading Use
The Tiki shows whether there are more individual stocks with increasing prices or decreasing prices, so it provides a detailed overview (detailed because it uses the individual stocks, and overview because it calculates a single value) of the sentiment of the markets. As the Tiki includes less stocks than the Ticks, it reacts faster than the Ticks, and will often signal something interesting before the Ticks. As the Ticks can be displayed as a bar chart, it can be interpreted like a price bar chart, using concepts such as support and resistance and trend lines. The Ticks can be used independently, or as part of a larger trading system.
