Tick Index

DEFINITION of 'Tick Index'

The number of stocks trading on an uptick minus the number of stocks trading on a downtick. Tick index is a popular indicator used by day traders to view the overall market sentiment at a given point in time. By being able to easily see the ratio of "up" stocks to "down" stocks, traders can more easily make quick trading decisions that are dependent upon market movement.

BREAKING DOWN 'Tick Index'

A tick index is a very short-term indicator, often only being relevant for a few minutes, if that long. For a trader looking to enter into a bullish environment, a positive tick index is a good indicator of overall market optimism, as more stocks will be trading on an uptick compared to those trading down. That being said, tick indexes are very speculative identifiers of market sentiment at a given point in time, and are considered quite unreliable for trades that do not encompass the short time span.

RELATED TERMS
  1. Uptick

    A transaction for a financial instrument that occurs at a higher ...
  2. Bid Tick

    An indication of whether the latest bid price is higher, lower ...
  3. Zero Minus Tick

    A securities trade executed on an exchange at the same price ...
  4. Teenie

    In trading, a measure of value representing one sixteenth of ...
  5. Zero Plus Tick

    A security trade that is executed at the same price as the preceding ...
  6. Closing Tick

    The difference between the number of stocks that closed higher ...
Related Articles
  1. Charts & Patterns

    Advantages Of Data-Based Intraday Charts

    We take a look at these chart intervals and how we can use them to our advantage.
  2. Investing Basics

    Understanding The Ticker Tape

    We explain the meaning and use of that reel of symbols whizzing across your TV or computer screen.
  3. Forex Education

    An Introduction To J-Charting

    Learn about a technical tool that's based on the view that markets are energetic systems.
  4. Trading Strategies

    What Your Trading Charts Aren't Telling You

    You may be missing some key statistics when following charts in the market.
  5. Charts & Patterns

    How To Use Volume To Improve Your Trading

    The basic guidelines to analyzing volume may not apply in all situations, but overall, they can help direct entry and exit decisions.
  6. Trading Strategies

    4 Common Active Trading Strategies

    Active trading entails buying and selling securities with the intent of profiting from short-term price movements.
  7. Technical Indicators

    Basics Of Algorithmic Trading

    Algorithmic trading is the process of using computers for placing trades in order to generate profits at a speed and frequency that are beyond a person’s capability.
  8. Investing Basics

    How To Choose The Right Online Trading Broker

    The online broker market is becoming more competitive, but differences exist in services that can help traders choose the broker that’s right for them.
  9. Active Trading Fundamentals

    The Risks and Rewards of Day Trading the UWTI (UWTI)

    Learn about the VelocityShares 3x Long Crude ETN, as well as its issuing company VelocityShares, and the potential risks and rewards of the ETN.
  10. Trading Systems & Software

    The Perfect Moving Averages For Day Trading (AAPL)

    5-, 8- and 13-bar simple moving averages offer perfect inputs for day traders seeking quick profits on the long and short sides.
RELATED FAQS
  1. What is the downtick-uptick rule on the NYSE?

    To ensure orderly markets, the New York Stock Exchange (NYSE) has a set of restrictions that it can implement when experiencing ... Read Full Answer >>
  2. What is Fibonacci retracement, and where do the ratios that are used come from?

    Fibonacci retracement is a very popular tool among technical traders and is based on the key numbers identified by mathematician ... Read Full Answer >>
  3. Is it better practice to use a stop order or a limit order?

    Both stop orders and limit orders have their advantages and disadvantages; traders need to decide between the two based on ... Read Full Answer >>
  4. How do day traders capture profits from the difference between bid and ask prices?

    Day traders capture profits from the difference between bid and ask prices by scalping stock. Sensing that a stock is going ... Read Full Answer >>
  5. How is buying on margin regulated by the Securities and Exchange Commission (SEC)?

    The Federal Reserve Board and the Financial Industry Regulatory Authority (FINRA) regulate buying on margin to a greater ... Read Full Answer >>
  6. Why is the Vortex Indicator (VI) important for traders and analysts?

    Doug Siepman and Etienne Botes developed the vortex indicator to anticipate reversals in price trends. They believed that ... Read Full Answer >>
Hot Definitions
  1. Black Swan

    An event or occurrence that deviates beyond what is normally expected of a situation and that would be extremely difficult ...
  2. Inverted Yield Curve

    An interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the ...
  3. Socially Responsible Investment - SRI

    An investment that is considered socially responsible because of the nature of the business the company conducts. Common ...
  4. Presidential Election Cycle (Theory)

    A theory developed by Yale Hirsch that states that U.S. stock markets are weakest in the year following the election of a ...
  5. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
Trading Center