Sentiment indicators: Behavioral Finance devotes considerable attention to market sentiment", which may be interpreted as the general level of optimism among investors. Technical analysts have devised several measures of sentiment among which is TRIN STATISTIC Market Volume is sometimes used to measure the strength of a market rise or fall. Technicians consider market advances to be a more favorable omen of continued price increases when they are associated with increased trading volume. Similarly, market reversals are considered more bearish when associated with higher volume. The trin statistic is defined as the ratio of average trading volume in declining issues to average volume in advancing issues Trin - (Volume of declining shares / # of declining stocks)/(Volume of advancing shares / # of advancing stocks) Ratios above 1 are considered bearish because the falling stocks would then have higher average volume than advancing stocks, indicating net selling pressure. On a particular day, there were 400 stocks that advanced on the NYSE and 800 that declined. The volume in advancing issues was 80 Mn and the volume in declining issues was 40 Mn. (l need to see the entire solution) A) Calculate Trin ratio. B) Explain whether technical analysts are likely to be bullish or bearish. A BIF T: A TI & 2 c Sentiment indicators: Behavioral Finance devotes considerable attention to market sentiment", which may be interpreted as the general level of optimism among investors. Technical analysts have devised several measures of sentiment among which is TRIN STATISTIC Market Volume is sometimes used to measure the strength of a market rise or fall. Technicians consider market advances to be a more favorable omen of continued price increases when they are associated with increased trading volume. Similarly, market reversals are considered more bearish when associated with higher volume. The trin statistic is defined as the ratio of average trading volume in declining issues to average volume in advancing issues Trin - (Volume of declining shares / # of declining stocks)/(Volume of advancing shares / # of advancing stocks) Ratios above 1 are considered bearish because the falling stocks would then have higher average volume than advancing stocks, indicating net selling pressure. On a particular day, there were 400 stocks that advanced on the NYSE and 800 that declined. The volume in advancing issues was 80 Mn and the volume in declining issues was 40 Mn. (l need to see the entire solution) A) Calculate Trin ratio. B) Explain whether technical analysts are likely to be bullish or bearish. A BIF T: A TI & 2 c
