Good traders analyse volume closely to determine the underlying strength of share price moves, and attempt to identify the participation (or non participation) of institutional players in a stock.

Its always been straight forward to analyse volume at the end of the day by reviewing the daily volume bars on any end of day chart. What’s been harder to do is comparing the current days volume against previous periods, in real-time, during trading hours.

The reason being is the volume traded throughout any given trading day is not linear. Rather, trading volumes are typically highest during the first and last hours of the trading session, with the intervening hours seeing much lighter volumes. Furthermore, stocks have their own unique trading patterns which makes it even harder to accurately asses if a stock is being heavily traded or not.

Given the non linear distribution of volume, it’s important to compare today’s volume against previous days/periods to the same point in the day. Spark’s Relative Volume Indicator does this.

Spark’s Relative Volume Indicator can be displayed by mousing over any volume figure in Spark.

This indicator, which is updates in real time, shows the stocks current volume along with

• yesterday’s traded volume at the same point in time
• the average weekly volume normally traded at this point in time
• the average monthly volume normally traded at this point in time

It also shows the actual difference and % difference of the current volume against these three periods.

Using the below graphic as an example we can see that by 11:14am Telstra had traded just over 67 million shares which was

• 43 million shares or 39.1% less than yesterday
• 29 million shares or 75.8% more than the average traded over the last week
• 8.5 million shares or 14% more than the average traded over the last month

Spark's Relative Volume Indicator

Spark's Relative Volume Indicator in context - Click to enlarge

Screening for volume breakouts

The relative volume figures can also be displayed within Spark’s Watchlists and Smartlists. You can set these lists to display either yesterdays, the weekly average or the monthly average figures. The lists can then be ordered by “Relative Volume  %” to produce a lists of stocks with the largest volume deviations from their normal traded volume.

Relative Volume in Smartlist - Click to enlarge

By using additional Smartlist filters you can refine this lists further to better identify trading opportunities. eg. Market cap > 300m or Number of trades > 50

Relative volume in Spark’s DDE feed

All relative volume figures are available in Spark’s DDE feed. More details here

“Our clients have been asking us to broaden our news coverage beyond the usual news-wire content.” said Adam Rands, Director of Iguana2, the parent company of Spark. “To achieve this we wanted to avoided the standard news feeds that every other trader has access to. Instead, we developed a news service that leverages the growing amount of valuable news content made freely available on the Internet via RSS feeds.”

RSS has become the de-facto standard for syndicating news content on the Internet with most major news websites and content providers now making their content available via RSS. Spark’s news service ingests and aggregates these RSS news feeds which enables the content to be immediately accessible within Spark.

“Valuable content is increasingly being published by independent news sources.” said Rands. “Using Spark’s news service customers can now access content from a wide array of sources and obtain timely, relevant information specific to their investments.”

Spark’s news service is preconfigured with a number of Australian financial news feeds, but Rands says it can easily be personalised. “If you want to access the latest commodity news, Australian government statistics, US bond rates, Twitter conversations or even ball-by-ball updates from the latest Ashes test, you can now do so from within Spark.”

The news service is enhanced by tools that allow users to quickly access stock specific news. With a single key stroke users can display a list of recent news articles that have been published on the Internet about a specific company. “This is a valuable tool to have integrated into a primary market information platform as it enables traders to obtain valuable company intelligence that’s not necessarily distributed on the wires.” said Rands.

Commenting on the potential for brokers and wealth managers to utilise Spark’s news service, Rands said: “Some of our corporate clients want to make their own research documents available within Spark. Currently this content is buried deep in their Intranets or document databases. By having their IT team independently create simple RSS feeds to reference their own content they can quickly and easily make it accessible within Spark.”

For more information on Spark please visit:
http://iguana2.com/spark

A lists of available options for a stock, along with their current trading summary can be displayed by typing “O” on any stock specific panel or by clicking on the Options button in the Stock Tools section of the toolbar.

Spark's ASX Exchange Traded Options List

The stock option lists can be filtered on a number of parameters including option type, expiry date, strike price, open interest etc.

Market depth and full charting functionality is available for all option series.

The ASX ETO Data Pack costs an additional $20 per month on top of the standard ASX subscription. See Pricing

If you would like to trial Spark with ASX Options then please complete the Spark trial application form.

Existing subscribers should contact us directly if they want to trial or subscribe to options data.

Spark is a desktop application that provides users with a comprehensive suite of ASX and NZX market information tools, including real-time depth, data visualisations, market playback, tick charting, market scanning, company news and data exporting functions.

“Spark has been developed by Iguana2 over the last four years and we are certain that it’s the most sophisticated market information platform available today,” Adam Rands, Chief Operating Officer Iguana2, said.

“Spark offers broking houses and wealth managers in Australia and New Zealand a viable alternative platform for the region,” Rands said.

According to Rands, Spark is simple to use, yet advanced in its functionality.

“The recurrent theme with all of Spark’s tools is a focus on usability and the clear communication of market activity,” Rands said.

“Trading movements and changes are presented with the intelligent use of animation, colour, transitions, shading and scroll speeds. The use of these elements conveys subtle, yet highly valuable information and enables users to actively monitor more stocks.”

Through its innovative market depth visualisation tools, Spark users can quickly analyse a stock’s current trading position and subsequent movements in the open order book. A unique playback function allows users to rewind the current or previous days and have the historical trading activity replayed at various speeds. This powerful feature allows users to test their theories on trading behavior and can help users to identify momentum shifts, support and resistance levels, dummy orders and the presence of algorithmic trading.

Spark is unashamedly different, says Rands.

“Spark’s development has been unencumbered by legacy software and systems. It is the next generation market information platform for the professional market and is fast, flexible and highly functional.”

“A key area where Iguana2 has focused heavily is the user interface for Spark,” Rands said.

“The typical approach of using a windows style MDI interface is not suited to streaming market data. Annoying pop-ups, drop-downs, menu/scroll bars and overlapping windows all take up valuable screen real-estate, and often get in the way of what’s actually important – the data. By developing our own purpose built user interface, market data takes centre stage and becomes accessible with unprecedented speed.”

And with the broking industry facing increased costs and declining revenue due to the ongoing financial crisis, Spark will offer the industry some relief with a competitive pricing model.

“Spark is a robust platform whose unique features will make it an indispensable application for equity market professionals,” said Rands.

”We’ve got a bold development roadmap for the inclusion of extra features and functionality over the coming quarters and we expect Spark to gain quick acceptance with domestic brokers, hedge funds and wealth managers.”

For more information on Spark please visit:

http://iguana2.com/spark

- ENDS -

Tuesday, 26th of February 2008 is a day Eddy Groves would rather forget.

But Spark doesn’t forget. With Spark you can replay the last 30 days trading activity.

This video graphically depicts Eddy’s nightmarish morning at 60x speed. Each minutes trading activity is represented every second. On Monday ABC’s stock closed at $3.74, within seconds of opening on Tuesday morning it traded as low as $1.15.

A combination of margin calls and aggressive short selling by hedge funds decimated the stock which ultimately cost Eddy the company he founded 20 years earlier.

Watch the pre market trading activity before the market opens and then when ABC goes into suspension around 11am. The blue bar in the chart indicates the expected opening price and moves in response to the changes in the bid and offer queues.

Note – video quality has been reduced to make it web accessible.

Spark’s depth charts visualises the outstanding order book for a stock by graphically depicting each buy and sell order.

Green bars represent the buyers and red bars, the sellers. The height of each bar indicates the aggregate volume of all the orders at a specific price level.

click image to watch video demonstration

As orders flow in and out of the order book and trading occurs the bars grow and contract. The chart animates these changes which over time, and with experience, can help you identify patterns in trading activity and potential trading opportunities.

Beyond displaying the current market depth, Spark also allows you to replay previous trading activity. You can access the last 30 days trading history and have the depth replayed to you at varying speeds.

This replay feature enables you to quickly establish a stock’s recent trading behaviour without having to constantly watch it in realtime. It can help to identify momentum shifts, support/resistance levels and the presence of algorithmic trading.

To see Spark’s market depth charts in action watch this short video presentation.

The Spark development is now complete but before we officially launch the service we want to conduct some final user testing.

We are seeking interested people who are willing to run and test Spark over the next few weeks. Testers will be amongst the first people to use Spark, a market information platform we believe is superior to all others available in the Australian market. We will provide Spark for free during the test period and will offer testers a reduced subscription rate should they want to subscribe in the future.

If you’re interested in helping us out send a message via our contact form.

An Iguana² representative will respond and provide you with further details.

Testers must

• be able to spend 45-60 minutes at our Sydney CBD based office to undertake initial training
• be, or have been, an active ASX equities trader
• have previous experience with other streaming market data services like Iress, BourseData, Pulse, ComSec Pro or Etrade Pro
• have access to your own PC and internet connection.
• be willing to submit bug reports and feedback if a problem is encountered