Aloha GV! Here is how Thompson's explains the chart:
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Interest Messages: These messages serve as a way for broker/dealers to send real-time
indications of interest to buy or sell securities. Interest messages are not binding, but merely
offer an indication of which broker/dealers are actively seeking to trade a stock. Generally,
the messages serve as means for the broker/dealers to say to institutional investors, "Give
me a call and we'll talk about a trade."
Super Messages: "Supers" offer a more explicit medium for broker/dealers to advertise
their interest in trading a stock. In a Super message, broker/dealers specify the exact price
and size of stock they want to trade, as well as whether they are interested in buying or
selling the security.
Because Supers require a minimum volume of 25,000 shares, they offer a unique
opportunity to gauge the interest of institutional investors. Due to the specific nature of
these messages and the fast pace of changes in the marketplace, Supers have a short
shelf-life and offer only a small glimpse of the total market for a security.
Buy/Sell Indicator: The I-Watch Institutional Activity Indicators (arrows) display the
weighted average price for all the buy/sell super messages within a given interval. The total
amount of share activity in the super messages determines the size of the arrow - the larger
the indicator, the larger the volume of shares that the brokers are advertising to trade. The
placement of the arrow on the chart corresponds to the weighted average price of the super
messages.
The direction and color of the indicator arrows reflect the buy sell ratio. An up arrow
signifies buys and a down arrow signifies sells. The color of the arrow will change depending
on the buy/sell ratio. If there is greater volume in the buy super messages than the sell super
messages in a given interval, the color of the indicator will be blue. Conversely, if there is
higher volume in the sell super messages than the buy super messages, the color of the
indicator will be red. The darker the color, the stronger the indicator.
Note: I was wrong, Super Messages are blocks of 25,000 or more.
Of course the average institution underperforms the market, that's why we (I ?) don't own mutual funds! I wasn't drawing any conclusions from the I-Watch data other than it seemed to show that institutions were net buyers today. This is useful for a number of reasons. High institutional ownership tends to stabilize a stocks price. It's also one of many indicators that the majority of shares are owned by investors with a reasonably long time frame, (though this is less true today than a few years ago).
Cheers
Alohal |
