Strange how these things work out, but 5450 was the bottom of our trading range when we last looked, and here it is, now as the bottom of the new zone.
Truly and sincerely our apologies as we really should have looked at the FTSE since the 30th March, especially under the circumstances.
As you can see in the table above there have been huge changes, not unexpected of course, but now, we just don’t know when they happened.
But it is worth remembering what we said above, “However, if the zone does become 5550-5650, then we would expect to see R1 kick in at 5450 below it, and 5850 above it, but in the meantime, the above is what it is”, as the levels you see now were all in the picture back then.
Just not quite how we predicted, but then again, in these markets, and especially as it has been two weeks in them, then we are more than happy with this, ecstatic really.
The most interesting aspect, for us at least, is the fact this market is back above its zone, as that means it is back in bullish territory, and who would have thought that, even a few days ago.
Talking of which, this expiry has just 4 days to run, so for those of you unfamiliar with this analysis, this is now the rollover.
Boy, it would be quite something, considering all that has happened, if this index expired in its zone.
But, first things first, and it has R1 at 5850 to contend with, and how it reacts to this, will very probably tell us all we need to know about how this expiry will end its last few days.
Range: 5550 to 5850
Type: On balance just bullish
Nb. Our comment on 04/17/20
To be honest we were surprised to see the zone move again, but that was only because we didn’t expect there to be many players returning to the market.
But, and as we said above, first things first, and how the market reacted to 5850 did indeed tell us all we needed to know.
Again, we must stress that these calculations should be done daily, otherwise we can’t capture when the zone did actually change.
However, considering the level of activity that we can see, and therefore what must have been transacted prior to this, it is a fairly safe assumption that this change took place for Thursday.
Funnily enough, whether or not the market manages to expire in its zone tomorrow, is not the most important aspect for us, although that indeed, would be remarkable, especially considering the circumstances.
What is the most interesting thing, is the fact that when the market reacted so badly to R1 at 5850, tumbling all the way back to 5576.35, there were enough players, and of sufficient size, to take a punt, and go for a 5650 to 5750 settlement price window.
Ballsy doesn’t begin to cover it.
Dare we even whisper it, but could normality be returning to this market?
The really important detail will now be how the May expiry will set itself up, and therefore, how the market will react from Monday, once these expiry trades are no longer influencing proceedings.