Using Market Internals To Become A Smarter Trader | Trading Tutorials

We discuss everything market internals in this video. From understanding what the market internals are, setting them up, and learning how to make better trading decisions, this trading tutorial has you covered in becoming a smarter trader.

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The market internals are going to allow you to look behind the scenes into whats actually happening across an entire market. These tools are going to give you a broader sense into wether or not a market is truly strong, or weak, and from there you can make more informed trading decisions.

The three tools we use to gauge this strength are; volume ($VOLD), advance decline line ($ADD), and tick($TICK) reading. Now technically stock volume is going to be calculated by taking the difference in volume flowing into up stocks vs volume flowing into down stocks. This is measured based on the prior days close. The advance decline line will tell us more about how many stocks on the given market are actually moving higher vs lower based once again on yesterdays stock close price. And lastly the fastest market internal of them all is the tick, which measures the last printed price and the current trade price. It will determine if a stock is moving up or down regardless of where we are trading in relationship to the prior day close.

By using these market internals we can now start to get a feel for what is normal and what is not. For example a breadth reading of 1:1 either positive or negative will tell us that there really is not enough volume flowing into the market to have a significant move in either direction. On these days we should look for and anticipate chop and responsive day trading off of key levels. If the breadth starts to pick up and read over 2:1 positive or negative then we can start to look for a trending day in which ever direction the breadth ratio is pointing. In general keep in mind that a negative breadth will usually be much more severe than a positive breadth. Look for -5:1 all the way up to -8:1 on a strong down day. Volume the ($VOLD reading) should also pick up right at the open on a trending day. When it is neutral and flat, volume will hover around the 0 line or not get much further than 2MM in either direction.

The advance decline line ($ADD) likes to hang out in specific regions. We can use trending zones in the + / - 1500 zones or look for a trending day in the market we are doing a technical analysis on. This would imply to us that the majority of the stocks on that exchange are all either positive or negative. If the $ADD is hanging out around the 0 line, we need to again expect some more responsive trade as the stocks on the exchange are now mixed and not giving as clear of a signal that the market its self should be trending.

Lastly the $TICK can be used to check out any emotional selling or buying when it reaches its extremes of + / - 800-1000. Whenever that happens you can generally take a fade or counter trend trade in the market as those levels of aggressive selling or buying of stocks are not usually sustainable. Keep in mind though that the trades need to be quick and responsible. This is not a trading strategy that is meant to be held all day. You can also look for divergences in the price action and where the $TICK lows or highs are going. If the tick does not make a lower low when the market does, theres a signal.

DISCLAIMER: The information provided in this video is for informational purposes only. It should not be considered financial or legal advice. I am not a Registered Investment Advisor. Buying and selling financial instruments is highly speculative and carries risk.

[TradeBrigade]

If you want more details for what the different internals are for the different exchanges, check out this article:

[flashstep]

I left another comment from the other day. Added all these indicators. Trying to learn how to use this properly. Today and yesterday, gave me a lot more confidence in the market. Nice run up yesterday, Internals made it easy to see and when to wait for a pull back. Today market chopped sideways the whole day... Internals made it easy to see. Obviously the charts you can see a sideways trends, but this helped me recognize it a lot faster, and more conviction, to either trade edges or not enter. Thank you for this. Hopefully will come back in a month to give a last update for anyone who reads comments in the future. I have watched this video a couple times.

[andrepow]

This is by far the best and most well explained video I've found about learning market internals. Thank you so much for this.

[cdevarona]

Excellent. This Gentleman is a VERY Good Teacher. Very few other individuals know how to explain this type, or any type of material. Appreciated, I will certainly log in into Tr Brig. Thanks

[karenlehmberg]

Best video on market internals, without a doubt. I really benefited from the practical examples of seeing ADD, TICK, VOLD explained relative to different market days to learn what the indicators were reflecting relative to the price action. Well done!

[vigneshramasamy]

Best Market Internals Video in YouTube 🙌🏻

[bobchristian]

Exceptional instructional video. You can always tell someone who knows what they're talking about when they can explain a complex idea in a simplified format so that the average person can understand. Thanks for taking the time to put this together and share the scripts. Second time I've watched this.

[samex]

I love the way you explain and break things down. I’m gonna become a member.

[harrisonmurbi]

Absolutely awesome!! April 27, 2023 was a positively trending day and that's why am here!!

[morpheus-trades]

I'm happy that I found this video but also saddened that I didn't find it earlier...you guys are making amazing videos....thank you very much

[Spitfireseven]

All this is very important stuff. Right now I have to throw off all judgements as to it's importance. This is amazing stuff. It makes a lot more sense as you get more experience, Watching this kind of video could kill some investors curiosity. It absolutely requires the right mind set. I stayed glued to it from beginning to end. Cutting and pasting can be a bit of an odd task. Sometimes the software gets it's own ideas that day. For some reason you do it the next day and POOF!! It just works! Thanks for another amazing video.

[flashstep]

Information overload on your Youtube Channel... need to rewatch several of them. Awesome.

[VirmanaMarketing]

You need to broadcast live from a day where you aren't going to trade so you can show us how to read these live. I would pay for that Matt. Awesome job!

[rajibm]

By far the best video on ADD and TICK...thanks for putting it together.

[moenopoly]

Such a great explanation of market internals and how you can use these tools to have an edge! Thank you so much for this video

[ampiciline]

Dear coach, I have seen so many videos on " TICK indicator" and your video has been THE BEST so far ...I mean the case scenarios that you mentioned about TICK indicator was so awesome . Alos, the way you explained how to get those little small green dots ( arrow ) and small red arrows on TICK graph was so great The best part of the video ( 25:20 -29)

[fotografkennethlund]

Very interesting - thank you very much for the time and effort you put into sharing this - I bought my first shares 3 years ago and have never heard of these "internals" 🙏

[chrisparker]

Always good to come back and get a refresher on the internals, iv had them for almost a year and there was so much I had forgotten!

[Consistent_Investor]

Market internals masterclass 🔥. Trying to add this to my trading, thank you! 💯🐐

[jhendric]

Do you have a video on how to set this up on Tradingview? I see you have scripts for Tradingvidew