SPX so far going exactly to plan, but huge expiry coming up next week now.

Nb. Our comment from 11/05/19

 

When we last commented on the SPX (28th Oct) it was all about R1, then at 3045.

And, blowing our own trumpet unashamedly, the next 4 intraday highs were 3044.08, 3047.87, 3050.10 and 3046.90.

Friday saw the deadlock broken, and very interestingly, it took a gap-up at the open, to 3050.72, to achieve what they had struggled to all week.

Of course, once the dam had broken, it was always going to then be about R2.

Back on the 28th this was at 3070, whereas today it is 3080, and although we now have no way of knowing exactly when it did change, we suspect slipping 10-points over Friday and Monday looks about just right.

So, the point being, is although the ratios are slipping above the zone, this index is now battling R2 ratio from here on up.

Don’t forget the rollover starts next week, so the gravitational effect of the zone will come to bear towards the end of this week.

Furthermore, the ratios below the zone have not built to any great degree, and in fact, with R1 static at 2895, the huge, no enormous, Y ratio bandwidth, with its inherent risk, remains in place.

It is timidly making all the right moves, for the bulls anyhow, and they could just continue knocking on a retreating R2 ratio door for sure, but whatever you do, don’t lose sight of the fact that the zone remains at 2995-3005, and the rollover is now just over a week away, and, that if it really gets a fright, the corresponding R ratios are now 180-points away.

 

Range:            3055  to  3080        or        3080  to  3130

Activity:          Moderate

Type:              On balance only just bearish

 

 

 

 

Nb. Our comment on 11/08/19

 

Exactly as we said back on the 5thand they could just continue knocking on a retreating R2 ratio door for sure”.

The intraday high on the 5th, when R2 was at 3080, was 3083.95.

On the 6th it was 3078.34.

Yesterday, when R2 had moved to 3095, the intraday high was 3097.77.

And, as you can see in the table above, today it is at 3100.

However, there are two huge facts you now need to bear in mind.

Firstly, it is the rollover next week and the zone remains stubbornly at 2995-3005.

Secondly, R1 has slipped to 3075, so a close anywhere below that, and this index is back into the Y ratios.

Of course, the ratios retreating above the zone and building below it are bullish, but one also has to be aware of the rate of change of these ratios.

And above the zone they are retreating, but hardly rapidly.

Whereas, below the zone, R1 climbing to 2935, is hardly going to excite anyone.

Scalp away on the pullbacks from the retreating R2 for sure, but, and again, just as we said back on the 5ththat if it really gets a fright, the corresponding R ratios are now 180-points away”, although admittedly the gap is “only” now 150-points, but that is to R1, to R2 it is actually 190-points.

This expiry is very far from over.

 

Range:            3075  to  3100          

Activity:          Moderate       

Type:              On balance bearish

November 8th, 2019 by