FTSE zone bandwidth test on Fri, DAX still to reach theirs, today’s Ratio Table, levels and comment.

Hope you were listening in the FTSE as “obviously, there is still considerable risk, but now we are into a new expiry, and if it can get back above 6750, then it could become a very rapid ascent up through the zero-ratio zone to 6900”.

The intraday high on the Wednesday and Thursday was 6753.29 and 6753.14 respectively, so Friday would have been strike 3.

However, the fact that the zone has changed, and the intraday high and low on Friday was 6850.37 and 6692.50, we suspect that this change happened on Friday.

Again, these ratios should be calculated daily, as that is almost the perfect zone bandwidth test, 6700 to 6850.

We say, almost, but really seven and a half points on a six-thousand-point index, that traded 150-points in one day, is probably the closest you will get to perfect.

Basically, a drawdown of 0.11%.

This should result in a breakout today, the only caveat is the DJX, which if you read our note on Friday you will appreciate how significant 23400 really is, and the close was above it, but only just, and that is a very large index, so 33-points is only 0.14%, which is rather ironic considering the above.

For the FTSE, obviously 6850 is a poignant level, but if it gets above that then there is still plenty of Y ratio above for it to play around in.

Although, due to the nervousness still embedded in this market, we rather doubt it will be the corresponding R3 ratio (intraday expiry low 6536.53 with R3 at 6550) so be rather wary circa 6950.

Range:            6700  to 6850 

Activity:          Poor

Type:              Bullish

There were two things we said in our last comment on the DAX that are worth repeating, “this makes 10600 very significant” and “it was the level of activity that caught our eye”.

The very next trading day the intraday high was 10612.

Also, as you can see below, that despite all the closures here over the festive period they have still maintained a very impressive level of activity.

Of course, not calculating the ratios daily coupled with a lot of closures makes any form of continuity here rather difficult, but despite this it has been fascinating to see their zone hold fast.

When this index was heading towards 10000 this looked misplaced, but after yesterday it doesn’t look so awkward anymore.

Using a broad brushstroke, the two pertinent levels over the last two weeks have been 10450 and 10250, and although the ratios may have fluctuated a little bit they have stood out, and actually over the last two weeks been counted as well.

The Y ratio bandwidth may have shrunk a bit, but it is still a very impressive 650-points, so don’t expect any quiet days anytime soon.

Range:            10600  to  10950

Activity:          Very good

Type:              On balance only just bullish