SPX , NDX & DJX Ratio Table 21st June 2018
At the moment it is all about the zones as both the SPX and DJX realign.
For the SPX this means it has virtually stood still from its close on Friday at 2779.66 to date.
In the meantime, on Monday it tested the upper boundary of its zone (low 2757.12) and on Tuesday the bottom boundary (low 2743.19).
So, to yesterdays’ close at 2767.32, the SPX has lost all of 12.34-points, hardly anything, but has managed to stay just above its zone.
Therefore, rather ironically, it is now the DJX that must make a decision while this index hovers, but impressive activity suggests it still wants a say.
Range: 2755 to 2785
Type: On balance bearish
This is a big day for the NDX as well, but here it has nothing to do with its zone.
Although, having said that, it is very likely that it will move up to 7075-7125, which is very early on in the expiry but does at least indicate involvement.
As does the fact that they have added almost 50 new strikes, the real issue will be if this generates any increase in activity.
Perhaps worth reminding that although activity is just above average as one can see from so much Y ratio present it is from a very low baseline, so not really that impressive.
The big issue here is that the market closed just above the step-up level we mentioned last time, at 2775, so although still minimal it is the first indication of how this market may react when it encounters its first level of resistance, no matter how small it is.
Range: 7025 to (7275) / 7425
The last few days just goes to show what can happen when the DJX is in such a wide zone.
Considering the SPX has lost just 12.34-points since its close on Friday, for the DJX that is from their close at 25090 to yesterdays they have lost a whopping 433-points.
Or to put it another way, from the upper boundary of their zone to near the bottom one.
And there in lies the rub, as at 24500 this index will have to decide whether it stays in its zone, or out of it, and into bearish territory.
The ramifications are quite serious, in mean potentially 600-points upside, but outside and the next support is not until 23500, which is a bit scary.
Range: 24500 to 25100
Activity: Very good
Type: On balance only just bullish