🇬🇧 TightShorts guide
Description of working with the main functionality tightshorts.ru
FINRA generates data based on its 4 liquidity pools, so that trading volumes are limited to transactions that took place within the pools. This data may not be enough for a complete cross-section of the market, but it is usually enough to determine the sentiment of trading volumes.
FINRA pools: TRF Nasdaq Chicago, TRF Nasdaq Carteret, TRF NYSE and ADF. You can read more about stock market liquidity pools here: https://www.nasdaq.com/articles/slicing-the-liquidity-pie-2019-02-11
The TightShorts project creates a database from FINRA reports every night and visualizes volumes in the form of graphs, as well as builds filters for easy stock search using a screener.
To track the movement of volumes inside each stock, as it can often be a visual illustration of suspicious trading activity.
Example: the stock is traded sideways before an important event (report), but the volumes indicate a clear increase in short trades within two weeks and now it is already 80% of the total volume! But nothing happens on the price chart. The event takes place and the action collapses, although nothing foreshadowed trouble.
I have already been saved by short volumes in several similar cases. I left the paper when I saw suspicious activity for me. Or I refused to believe in it and got a loss 🤣
The ratio of the short volume to the total makes it possible to assess the mood of the movement. Short Volume Ratio acts as another market sentiment.
As a rule, securities whose daily short volume is stable at the upper limit (70% and higher), at the slightest negative news, fall more than others. The opposite is true for those who marinate for a long time in the range of less than 30% of the short volume.
Short volume analysis is not a universal independent trading strategy. It can only be used as an addition to your strategy.
In order to successfully work with ready-made volumes, you must first understand the terminology and abbreviations used on the site.
All volume indicators should be understood adjusted for the fact that these are the volumes of FINRA pools, and not the entire stock market.
Short Volume (SV) - the volume of short sales (short transactions) for the day. It represents the number of shares sold in short for 1 day. As a rule, most of the shorts are closed on the same day as they were opened.
Attention! Do not confuse Short Volume (short volume for the day) with Short Float (the total number of shares in the short). This project is aimed exclusively at studying Short Volume. Shorts Volume of 80% is not a signal for a short-visa.
Total Volume (Total vol, TV) - the total volume of completed transactions for the day.
Short Exempt Volume (SEV) - the volume of closing short positions for the day (the released volume of shorts). This means the closure of those shorts that were postponed for the night.
Short Volume Ratio (SV,%) - the relationship of Short Volume to Total Volume. (percentage of shorts from the total volume)
Short Exempt Volume Ratio (SEV,%) - the ratio of Short Exempt Volume to Total Volume. (percentage of closed shorts from the total volume)
Enter the stock ticker in the field and press the "FInd" button or press Enter. Enter only tickers that are traded on 🇺🇸 American exchanges.
Chart of the ratio of the short volume to the total in %. The purple zone is Short Volume. For convenience, you can take the values of 30% and below as low interest in the short, and above 70% as high. Everything between +- neutral values.
Short Volume Ratio chart
The red line at the bottom is the Short Exempt Volume Ratio. It is rarely higher than 0%, especially in liquid securities. There is no range of normal values for it, since the more liquid the paper, the less noticeable the movements to close the shorts become. It is worth paying attention to it when the value is significantly higher than the average statistical fluctuations. This may indicate a strong level at which long shorts begin to cover.
The bars at the very bottom are the bars of the total volume. Their color has nothing to do with the closing price (as in standard volumes). The bar is colored green when the short volume is less than 50% and red when it is more than 50%.
You already know which indicators are normal and which are not. Just like with technical analysis oscillators, it is worth looking for divergences / convergences here.
An example of abnormal short activity for one of my positions is NTGR. Two weeks before the report, the short volume began to grow every day. One day, the indicator completely exceeded 90%.
NTRG short activity before the report
The stock falls by 14% and the short volume is briefly unloaded. It is obvious that the shortists expect a further decline in quotes.
Another recent example is VEON. There is already an extremely rare bullish setup here. The stock is pickled at the bottom in the region of $ 1.6 for the whole summer. Being at the level is accompanied by extreme purchase volumes and an unimaginably low daily short volume in the region of 6%.
Bullish setup of short volume by VEON
With such a setup, VEON has already flown by +30% twice over the last summer, and judging by the continuation of the trend, this may not be the end.
And here is an example of reading SEV,% (Short Exempt Volume Ratio). Here we have DDOG, whose closing volumes of shorts began to grow by 18% (from 0% to 4%) 3 days before the take-off. Moreover, the closing of the shorts is accompanied by an increase in the total trading volumes.
DDOG Short Activity
After the takeoff, the trend for closing shorts continued at a doubled pace - it was already traders who closed by a stop or margin call.
An example of an obvious anomaly for SEV,% for CAT. In one day, 29% of short closing transactions were made. Such activity in a stock of such a huge capitalization is very rare. Most likely, some large fund closed short positions after a significant drop in quotations. The fact that it closed here underlines the importance of this price level ($205-215).
Short CAT Anomaly
The logic of this graph is no different from the previous one. Unless the volumes are presented in quantity, and not as a percentage. Here you can more clearly consider the spread between the short volume and the total. This is especially useful during peak trading volumes to assess his sentiment.
Short Volume chart
On each page of the promotion there is a table with the latest data, according to which graphs are built from above. The symbols were discussed above in the Terms section.
Table with short volume data in Tight Shorts
If you scroll through the table to the very bottom, then there you will find links to download all the data on the stock in a tabular format. You can use this data for your personal calculations in Excel.
Links to download the entire table with TightShorts data
The table is presented in two formats: CSV (comma) and CSV (semicolon). They differ only in how the data is written to the file. In the first case, a comma (standard) is used as a data separator, and in the second, a semicolon is used. In some countries and systems, the CSV format is set with a semicolon separator by default. You have a choice in which format to download the data. If you don't know which one you need, download the first one and try to open it using Excel. If there are no problems, everything is OK.
TradingView charts is a standard widget of the most popular platform for charting stocks. Its performance does not depend on TightShorts in any way. TradingView also does not give us access to the data of the candle chart. The chart is provided solely for reference and more convenient comparison with the short chart.
TradingView Chart on TightShorts
I will answer a popular question in advance. No. TightShorts data cannot be embedded as a script for TradingView. At the moment, TradingView does not support accessing third-party APIs in PineScript (and it is unlikely to be).
In the upper right corner of the site there are several additional options that you can use. Gradually, their set will be replenished with new ones.
You can also go directly from the promotion page to my Short-Fork project (link in the top menu) for a cursory assessment of multipliers, basic technical analysis and the formation of links to additional information resources on the selected security.
The statistics of the volume of short positions are considered as the average for 5/10/20/40 trading days.
Additional functionality buttons and statistics
The additional options buttons are located immediately above the short statistics. From right to left:
- Reference information. This section provides brief tips on the terms used on the site.
- Changing the size of graphs. An alternative version of the page layout in which the graphs are arranged in full width.
- Telegram bot TightShorts. A bot that sends notifications about your portfolio.
At the moment, the Telegram bot is frozen. There are too many bugs affecting the stability of the application. Plus, my total lack of time to develop all the products alone. If there are people who want to join, then look for me on GitHub.
If you like what I do and you have a desire to help the project, then you can do it in two ways:
I hope the project will be just as useful for you! Have a good use to everyone)