FTSE and DAX Ratio Table 23rd Nov 2017
Sometimes one can’t help but feel a bit sorry for equities in the FTSE as you could see they really wanted it to go better on the Budget, and most probably couldn’t work out why anyone was selling futures.
Trouble is they are now in R1 ratio so every step forward comes with this degree of dynamic delta hedging, so the high yesterday came in at 7460.91 to no surprise.
Of course, they will get accustomed to this level of activity and it is only because recently this index has been in or around its zone that it is not up to the aggressiveness we find elsewhere.
The fact it was heading back towards its upper boundary but the auction reversed that and added 4.47-points shows the bulls are there and getting up to speed.
Range: 7400 to 7550
Type: Not bullish
With the DAX finishing as close to the middle of its zone as such a big index can get raises our eyebrows, and as everyone knows we are no lovers of coincidence.
The problem is how to interpret it, and it could just be coincidence, but we think not, especially as the low was 13008 and the real time close was 13012, so it looks to us as if this is where it chose to be.
Aggression comes and goes in the DAX and it may well be after the US indices, especially the DJX, hit serious ratio levels they think a time-out is necessary.
Don’t forget that there is precious little ratio underpinning this index, although today we have got our first improvement with Y2 strengthening.
Range: 12950 to 13050