Public Short Sales Ratio
The NYSE Members Report is compiled by the SEC and issued about two weeks after the applicable date. This indicator is a useful tool to determine what the public or the so called crowd is doing. The Public Short Sales Ratio is computed by dividing the total public short sales by total short sales. A moving average should be applied to smooth out the swings. The public is usually wrong about the trend of the market. If they are shorting heavily the market is usually ripe for an upturn. On the other hand, if they are doing relatively little shorting it is most likely that the market is near a correction, especially if specialists short sales increase at the same time.
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