Hey Ryan, you already got some great responses to the questions about the finra numbers (I think ExB's response kind of sums up all the important stuff).
I think you either believe in the FLD concept or you don't, and I believe in it. Unfortunately, the finra numbers are never really going to tell you anything useful about what is going on. For one, naked shorts will often not show up in the numbers. Market makers have many ways to hide what they are doing and manipulate the finra numbers. Clearing outside of the DTCC is one example. Another is the fact that where and how a share is counted in the numbers varies. For example, both buys and sells can show up as shorts in the count depending on where they are counted.
Consider someone selling a share through their broker, there are two legs to the transaction, the MM selling the shares into the market and the MM taking ownership of the shares from the broker. There is also a third case in which the MM just buys the shares from the broker to complete the sale and holds them (MM's can take both short and long positions in a pinkie stock and often do). In this sell case, if the leg of the sell transaction from MM to eventual buyer is counted, the sell will (somewhat surprisingly) appear as a short. If the buy from the broker to MM leg (or the buy to hold by the MM) is counter, the sale will not appear as short. Only one leg of the transaction will appear in the daily numbers.
Buy transactions are equally confusing as they also have two legs. The leg from the market to MM and the leg from MM to broker. If the leg from market to MM is counted, the buy not will show up as short (as the MM bought shares). If the leg from MM to broker is counter, it will show up as short (as the MM sold shares to the broker). There is also a third case in which the MM sells its own inventory to complete the buy (which will probably not show up as short) and a fourth case in which the MM sells shares it doesn't have (naked shorts) to complete the sale. This last case is what makes the FLD possible (and also why MM's are legally allowed to naked short to make a market).
In other words, the daily numbers really tell you nothing useful (longer trends can be a bit interesting but are often still very misleading). This is also without even considering clearing transactions outside the DTCC (often used to hide naked shorts from the FTD numbers).
As I said, you either agree with the FLD concept and act on it or you don't. The finra numbers unfortunately won't necessarily give you much assurance whether it is working or not.
Hope this helps more than causes additional confusion.
