NDX Aug to Sept Ratio Rollover Table 16th August 2018
The NDX has been a difficult read this expiry, mainly because it kept making suggestions towards interest returning, and then when it eventually did materialise it was of insufficient or ambiguous quantity to discern whether it was the big players or not.
This index can do its own thing, but this time it looked like it was a team player, and in the first week it did bounce off their zones bottom boundary.
After the SPX had hit their R1 and retreated so did the NDX, so both in sync really, getting way below their zone, the trouble was is that this was when the DJX was being so stubborn with trying to break through 25500.
The DJX was definitely the odd one out, so this was good news for the bulls here, as it meant the expiry low was just 7158.78, which at that stage was over 100-points from the support of Y2.
There then followed a very impressive run up to the corresponding Y2, then at 7475, easily beating the SPX to their first resistance level.
For once, the zone here has stayed static, and we would like to say the fact it finished bang in the middle of it on the Wednesday was expected, but sadly it wasn’t.
If anything, we would have expected the zone to move up to meet a reluctant index begrudgingly stooping to meet it.
However, if the market did suffer a setback then this is the natural resting place.
Interestingly the middle of both the SPX and DJX’s zones are 2800 and 25000 respectively, and their lows yesterday were 2802.49 and 24965.
Obviously, we can’t claim to have spotted the low, so we will take the bottom of the zone, which was then 7275, up to Y2, which was 7475, and back to the middle of its new zone, 7350.
Not that impressive being just 5.92%, and the NDX can do better, but with the DJX upsetting everyone this was probably the best under these circumstances.
Range: 7325 to 7375
Type: On balance decidedly bearish
September is already building up to look like it is going to be very interesting.
We say that as this index tends to favour the bullish tack, but this time the ratios are definitely loaded to the upside (i.e. Where the futures selling will be).
The issue may well come down to how active this triple is going to get, and whether Y2 will prove sufficient.
Generally, for a biggie this is not the case, so in the absence of any R ratios below the zone this makes for a very high-risk scenario, and at the same time, above the zone, R1 is already present at 7500.
Also, don’t ignore that here the zone is below August’s, at 7275-7325.
Of course, a lot can change in the next few days, but it might be worthwhile going back to our post on the 14th August regarding the rollover situation in the SPX, as if these two do stay in sync then if they find themselves hitting a ratio level at the same time, or thereabouts, they should reinforce each other.
Range: 7325 to 7425