September 21st, 2021 by Richard

Starting the Oct expiry below its zone was bit of a shock for the SPX it seems.

 

Nb. Our comment from the 09/16/21 (Not published)

 

Nb. Our comment for 09/21/21

 

The important aspect is that anyone who has read our comments over the last few expiries should have been in no doubt whatsoever about this potential pullback.

The only shame is that we still don’t publish the ending expiry ratio table next to the forthcoming expiry ratio table in the rollover week, as then you would have also known about which levels to watch out for.

Interestingly the zone in October has been very solid where it is, despite September’s jump to 4500. We say “interestingly” as just like the FTSE, where this index closed last Friday was below it, and therefore in bear territory.

However, the really critical level yesterday, was Y2 at 4340, as had you known that it was there you would have picked up on the support it gave this index for at least half an hour, before capitulating. The fact the market then went a further 35-points below it, had us looking at R1 as the next level but, and this was probably more to do with the DJX, it recovered. Also, on the very first day of an expiry, especially when markets are challenging virgin territory, the actual ratio levels can be somewhat formative, and as you can see in the above table, last Thursday Y2 was actually 4295. For the record, yesterdays intraday low was 4305.91.

Perhaps more significant for today, was yesterdays close, which was back above Y2.

Possibly most important of all, it has seemingly galvanised everyone as we have now had two consecutive days of “strong” activity here, on what was otherwise shaping up to be yet another expiry when the market was stuck in automatic.

The end result of this has been the Y1 ratio bandwidth only being 190-points, and the overall Y ratio bandwidth just 345-points. Of course, these are still stupidly wide, but both are considerably less wide than they have been, and furthermore, at least so far, have reversed the trend of them actually growing wider.

Also, it has certainly kick-started this intermediary expiry into life early on, which will hopefully continue.

 

Range:            4340  to  4445           

Activity:          Strong

Type:              Neutral

 

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September 14th, 2021 by Richard

The SPX zone eventually moves, now it can get on with the rollover and expiry.

 

Nb. Our comment from the 09/07/21

 

After the first week when the SPX made full use of its enormously wide Y1 ratio bandwidth by effectively traversing the entire width of it, last week must have come as bit of a shock.

And there is no doubt about it, but the last week was all about this index struggling to make any more forward progression now it was deeply into the Y2 ratio.

Although this has not been uncommon of late, it is still rather sad, as even Y2 is classed as “minimal”. Especially in a triple.

Anyway, we have eventually seen some movement in Y2 above the zone, as it has now slipped to 4530.

The significance being that, with this level now in retreat, coupled with the market being practically at the same point now, then it is decision time for this index.

Whether to continue to struggle in Y2, or retreat back into the far more comfortable Y1 ratio bandwidth.

If it does choose the latter, then further forward movement could well be limited to how quickly Y2 continues to retreat.

All the while there remains a spectacularly wide Y1 ratio bandwidth beneath it, which still goes all the way down to 4220, a mere 310-points away.

Of course, there is the zone before then, so should the market indeed turn south, then this should provide the first line of support.

But if the SPX follows the pattern of the last few expiries, then we should see it bumping along behind Y2, knocking on that door and hopefully forcing that retreat to at least continue, if not accelerate.

In the meantime, we haven’t seen an expiry recently that the zone itself hasn’t moved up, so come the rollover and expiry next week, even that target could very easily be a lot higher. But all the time the huge Y ratio bandwidths beneath this market will be there, so that risk will also be ever-present.

 

  Range:          4405  to  4590           

Activity:          Poor

Type:              On balance bearish

 

 

Nb. Our comment for 09/14/21

 

And there we have it! The SPX’s zone moves up to 4495-4505.

TBH, it has been a bit like watching paint dry, this move having been flagged for so long.

Furthermore, it has created bit of a schizophrenic index in all truth, as on the one hand the siren-like call of the zone when it was down at 4395-4405 had the market being called in that direction.

However, it was obviously somewhat reluctant, and not just for those stale bulls who had fought so hard with Y2 just the week before but, because the move up to 4495-4505 was imminent any day.

Hence it was sort of stuck in no-man’s land between the two.

One sort of feels that now this has eventually happened, the real rollover and expiry can get underway.

In the meantime, it is going to make for a very interesting day today, as for the first time this expiry, the SPX is now actually below its zone, and therefore, by definition, in bear territory.

If nothing else, this should at least galvanise those bulls, and whether or not they succeed in getting back to the (new) zone for the rollover tomorrow is going to be the big question, a question with very interesting consequences if they don’t.

Interestingly, and as is quite normal these days, we have seen a lot of writing of otm puts, and what with just days to go this can be seen by some as “safe” money, so getting back to the new zone will be rather important to these traders especially.

Overall, the Y1 ratio bandwidth is now 295-points, with the total Y ratio bandwidth coming in at 435-points, so a slight narrowing, but not by anything significant.

This really means that the zone has moved up inside the Y1 ratio bandwidth, rather than being forced in this direction by bullish activity, which is ok, but not representative of a true bull market. Still, it makes for an exciting expiry at least.

 

Range:            4245  to  4495           

Activity:          Average

Type:              Bearish

 

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September 7th, 2021 by Richard

After struggling in Y2 Ratio will the SPX welcome a move back to the Y1 bandwidth.

 

Nb. Our comment from the 09/01/21

 

This is definitely a first for us, that is, publishing the first note on an expiry in the actual month of its expiry.

Considering the market fell back to its zone at 4400 for the August expiry it’s no real surprise “normal service” was resumed as soon as it was over.

Therefore, and again absolutely no surprise, that the market started hitting new highs last week as Y2 above the zone didn’t even start until 4505.

The interesting aspect was last Friday the 27th, as Y2 hadn’t moved, and yet the market powered on up right through it.

Sadly, we weren’t witness to whether or not it had any effect on the market as it blasted through, only seeing the end result the next day.

This means that the start of this week has been very illuminating as this market handles being in the Y2 ratio bandwidth.

Of course, this is a triple, so we would expect as much, but perhaps not quite so early on.

Otherwise, it is pretty much exactly as we have been seeing over the last few expiries.

Retreating ratios above the zone, which in itself is looking to move up, all wrapped up in an overall lack of ratio, albeit being a triple these are far far higher than an intermediary, but comparing like with like, then the argument still holds true.

However, what is a big concern, is that the Y1 ratio bandwidth is 285-points, with the overall Y ratio bandwidth 435-points, this is as wide as we have ever seen it…which is remarkable considering this is a triple.

We are essentially back to our automatic car in neutral, just nobody say “BOO”.

 

Range:            4405  to  4580           

Activity:          Poor

Type:              Neutral

 

   

Nb. Our comment for 09/07/21

 

After the first week when the SPX made full use of its enormously wide Y1 ratio bandwidth by effectively traversing the entire width of it, last week must have come as bit of a shock.

And there is no doubt about it, but the last week was all about this index struggling to make any more forward progression now it was deeply into the Y2 ratio.

Although this has not been uncommon of late, it is still rather sad, as even Y2 is classed as “minimal”. Especially in a triple.

Anyway, we have eventually seen some movement in Y2 above the zone, as it has now slipped to 4530.

The significance being that, with this level now in retreat, coupled with the market being practically at the same point now, then it is decision time for this index.

Whether to continue to struggle in Y2, or retreat back into the far more comfortable Y1 ratio bandwidth.

If it does choose the latter, then further forward movement could well be limited to how quickly Y2 continues to retreat.

All the while there remains a spectacularly wide Y1 ratio bandwidth beneath it, which still goes all the way down to 4220, a mere 310-points away.

Of course, there is the zone before then, so should the market indeed turn south, then this should provide the first line of support.

But if the SPX follows the pattern of the last few expiries, then we should see it bumping along behind Y2, knocking on that door and hopefully forcing that retreat to at least continue, if not accelerate.

In the meantime, we haven’t seen an expiry recently that the zone itself hasn’t moved up, so come the rollover and expiry next week, even that target could very easily be a lot higher. But all the time the huge Y ratio bandwidths beneath this market will be there, so that risk will also be ever-present.

 

  Range:          4405  to  4590           

Activity:          Poor

Type:              On balance bearish

 

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September 1st, 2021 by Richard

The SPX is already looking aggressive.

 

Nb. Our comment from the 08/27/21 (Not published)

 

Nb. Our comment for 09/01/21

 

This is definitely a first for us, that is, publishing the first note on an expiry in the actual month of its expiry.

Considering the market fell back to its zone at 4400 for the August expiry it’s no real surprise “normal service” was resumed as soon as it was over.

Therefore, and again absolutely no surprise, that the market started hitting new highs last week as Y2 above the zone didn’t even start until 4505.

The interesting aspect was last Friday the 27th, as Y2 hadn’t moved, and yet the market powered on up right through it.

Sadly, we weren’t witness to whether or not it had any effect on the market as it blasted through, only seeing the end result the next day.

This means that the start of this week has been very illuminating as this market handles being in the Y2 ratio bandwidth.

Of course, this is a triple, so we would expect as much, but perhaps not quite so early on.

Otherwise, it is pretty much exactly as we have been seeing over the last few expiries.

Retreating ratios above the zone, which in itself is looking to move up, all wrapped up in an overall lack of ratio, albeit being a triple these are far far higher than an intermediary, but comparing like with like, then the argument still holds true.

However, what is a big concern, is that the Y1 ratio bandwidth is 285-points, with the overall Y ratio bandwidth 435-points, this is as wide as we have ever seen it…which is remarkable considering this is a triple.

We are essentially back to our automatic car in neutral, just nobody say “BOO”.

 

Range:            4405  to  4580           

Activity:          Poor

Type:              Neutral

 

Available to buy now

The faction account of the Big Bang, The Great Storm and the market crash of 1987, available in eBook and paperback here, a must read if you don’t believe in history repeating itself.

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August 18th, 2021 by Richard

Could Y2 at 4480 end up by being the all-time, expiry and intraday high for this expiry?

 

Nb. Our comment from the 08/12/21

 

Bang on the money, or probably more appropriately, still banging on that Y2 ratio door.

As one can see from the above table, that this particular door is now standing at 4455.

We haven’t calculated the ratios this week until today, but last Friday Y2 was 4430, so the market essentially forced the door ajar and got a foot on the other side.

The start of this week was effectively the market waiting for the ratios to catch up.

But now they have forced the changes, then the dominoes keep falling.

OK, the ratios below the zone have hardly shifted, but they are certainly building up to it.

In the meantime, the zone will move up again, to 4395-4405, and we suspect the only limiting factor to further moves is that it is the rollover and expiry next week, so time.

Of course, Y2 is very likely to continue to retreat, and we suspect R1 will start doing so before long as well.

So really, the only main concern is the fragility of it all, as the Y1 ratio bandwidth increases to 260-points, whereas the overall Y ratio bandwidth narrows to 390-points, both still ridiculously wide.

It is the most amazing market we have come across, as it continually powers to new highs, but at the same time, overall, the level of ratio is abysmal as are the daily levels.

This means that this bull run and resultant new all-time-highs have been achieved without very many bulls at all.

The saving grace has really been that there have actually been fewer bears than the miserly number of bulls out there, but, hey, who’s to say that’s not wrong, it’s just that previously the numbers have just been far bigger but the split remains the same.

 

Range:            4355  to  4455           

Activity:          Poor

Type:              Neutral

 

 

 

Nb. Our comment for 08/18/21

 

The zone did move up, the very next day in fact, to 4395-4405 and, as we said, the only aspect limiting further moves up is time.

It is the rollover today, and when the SPX was heading south yesterday and down almost 62-points at around 4417 we figured it was heading for its zone.

When it reversed, managing to finish where it did, we then figured that the zone had made the next move up.

As one can see, it turns out that neither are the case.

And this in a nutshell, is what the problem is at the moment, to us at least, as with so little ratio it is all so very thin and fragile that it doesn’t know what is happening next.

Which is a nice little lead-in to what is happening next in the big picture, and we don’t mean the upcoming triple witching September expiry, but the end of tapering. As, should that ever end, then excluding the last decade or so, and markets return to normal, it would be great to see them act naturally to the dynamic delta once again.

Getting back to the soon to end August expiry and, interestingly, Y2 has remained at 4480, where it was when this market’s intraday, all-time and expiry high hit 4480.26 on Monday.

Which if it stays like this, would be its own triple, albeit in an intermediary expiry.

For the record, Y2 here has actually strengthened from yesterday, but is still down a little bit from where it was on Monday.

So, to keep up the analogy, the door remains closed.

However, the ratios have started to move below the zone, and although narrowed the Y ratio bandwidths are still a gargantuan 235 and 385-points respectively.

Therefore, it is much the same as it has been all expiry really, Y2 at 4480 is the closed door, the zone could be anywhere in the Y1 ratio bandwidth really, but currently the favourites by a very small margin are (obviously) 4400 and possibly 4450, or anywhere in-between, while a chasm remains below a QE inflated market.

 

Range:            4405  to  4480           

Activity:          Poor

Type:              On balance bearish

 

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The faction account of the Big Bang, The Great Storm and the market crash of 1987, available in eBook and paperback here, a must read if you don’t believe in history repeating itself.

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August 12th, 2021 by Richard

Y2 in retreat, zone rising, what's not to like?

 

Nb. Our comment from the 08/03/21

 

The zone moved the very next day after we published last, so Thursday 29th.

In yet another apology from us, as we are seriously so underwhelmed by this, we hope it does not distract from these comments.

Of course, these days this is getting quite commonplace, but for far too long than we would like to remember, a zone move in the SPX was a really exciting event.

Nowadays, it is just as if by default, virtually natural geological erosion, albeit of the ratio variety other than natural features, rather than synthetic in nature.

Which essentially means the Y1 ratio bandwidth remains static at 245-points, as does the overall Y ratio bandwidth, at 410-points.

Remaining ridiculously wide, and therefore still very dangerous.

But, in the meantime, what we said last time is evidently what is still happening, as it knocked on the Y2 ratio door at 4415 last Wednesday, with the intraday high of 4415.47.

As you can see from the table above, Y2 is now 4430, and the intraday and, so far at least, expiry high, was 4429.97, the very next day. As we said, “knock knock knocking on the retreating Y2 ratio door”.

Activity has also seemingly dried up, but then again, as we are in the third week of a five-week expiry, then this is not really unusual.

As the SPX goes through the mid-expiry motions, it creeps higher leaving a vast void of practically no support beneath it.

So, on the surface it all looks good, even peaceful and serene, with rising ratios below the zone, which is in itself rising, as well as retreating ratios above it but, make no mistake, this is not a risk-free market, although most evidently think it is.

For us this risk is actually quantifiable, as the corresponding Y2 level is currently at 4185, which is 202-points away (4.6%), which should at the very least give you something to put into your models. 

 

Range:            4355  to  4430           

Activity:          Poor

Type:              On balance bullish

 

 

Nb. Our comment for 08/12/21

 

Bang on the money, or probably more appropriately, still banging on that Y2 ratio door.

As one can see from the above table, that this particular door is now standing at 4455.

We haven’t calculated the ratios this week until today, but last Friday Y2 was 4430, so the market essentially forced the door ajar and got a foot on the other side.

The start of this week was effectively the market waiting for the ratios to catch up.

But now they have forced the changes, then the dominoes keep falling.

OK, the ratios below the zone have hardly shifted, but they are certainly building up to it.

In the meantime, the zone will move up again, to 4395-4405, and we suspect the only limiting factor to further moves is that it is the rollover and expiry next week, so time.

Of course, Y2 is very likely to continue to retreat, and we suspect R1 will start doing so before long as well.

So really, the only main concern is the fragility of it all, as the Y1 ratio bandwidth increases to 260-points, whereas the overall Y ratio bandwidth narrows to 390-points, both still ridiculously wide.

It is the most amazing market we have come across, as it continually powers to new highs, but at the same time, overall, the level of ratio is abysmal as are the daily levels.

This means that this bull run and resultant new all-time-highs have been achieved without very many bulls at all.

The saving grace has really been that there have actually been fewer bears than the miserly number of bulls out there, but, hey, whose to say that’s not wrong, it’s just that previously the numbers have just been far bigger but the split remains the same.

 

Range:            4355  to  4455           

Activity:          Poor

Type:              Neutral

 

Available to buy now

The faction account of the Big Bang, The Great Storm and the market crash of 1987, available in eBook and paperback here, a must read if you don’t believe in history repeating itself.

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August 3rd, 2021 by Richard

The SPX still fixated with Y2 Ratio.

 

Nb. Our comment from the 07/28/21

 

The exciting start to this expiry, as having scrambled straight back into bullish territory like a scalded cat, it continued on its upward trajectory.

Which was really the least we would expect, having found being below its zone so distasteful.

The first real ratio test came last Friday 23rd August when the market hit Y2 for the first time.

And it did a very reasonable job of stemming what was a very strong tide at that time, as having been as low as 4233.13, by the time it hit 4405, this was a rally of 172-points, or 4.06%. The high was 4407.54 for almost 2 hours.

And in just 5 trading days, so that is some momentum behind it, so, hence, good job.

Obviously, the market then hit a new all-time-high, which is always difficult to compete against, that day, and again on Monday, but only managing to add just 10 more points to Friday’s level.

The drop yesterday was significant, but also because it ended below 4405.

Interestingly, today is the first time that Y2 has fallen, and as you can see from the table above, it is now standing at 4415.

Overall, the picture remains much the same as the Y1 ratio bandwidth has increased slightly, but the overall Y ratio one has decreased.

Also, there is blatantly far more ratio below than above, revealing a fairly obvious path of least resistance.

Adding to all this is that the zone will move up to 4345-4355.

We could see the next four-weeks of this index knock knock knocking on the retreating Y2 ratio door, after all it wouldn’t be the first time. But, please do not lose sight on the fact that it continues to sit atop an abyss of ratio, and one which continues to not want to fill in behind the rising market, which is a real worry.

 

Range:            4305  to  4415           

Activity:          Moderate

Type:              On balance bearish

 

 

Nb. Our comment for 08/03/21

 

The zone moved the very next day after we published last, so Thursday 29th.

In yet another apology from us, as we are seriously so underwhelmed by this, we hope it does not distract from these comments.

Of course, these days this is getting quite commonplace, but for far too long than we would like to remember, a zone move in the SPX was a really exciting event.

Nowadays, it is just as if by default, virtually natural geological erosion, albeit of the ratio variety other than natural features, rather than synthetic in nature.

Which essentially means the Y1 ratio bandwidth remains static at 245-points, as does the overall Y ratio bandwidth, at 410-points.

Remaining ridiculously wide, and therefore still very dangerous.

But, in the meantime, what we said last time is evidently what is still happening, as it knocked on the Y2 ratio door at 4415 last Wednesday, with the intraday high of 4415.47.

As you can see from the table above, Y2 is now 4430, and the intraday and, so far at least, expiry high, was 4429.97, the very next day. As we said, “knock knock knocking on the retreating Y2 ratio door”.

Activity has also seemingly dried up, but then again, as we are in the third week of a five-week expiry, then this is not really unusual.

As the SPX goes through the mid-expiry motions, it creeps higher leaving a vast void of practically no support beneath it.

So, on the surface it all looks good, even peaceful and serene, with rising ratios below the zone, which is in itself rising, as well as retreating ratios above it but, make no mistake, this is not a risk-free market, although most evidently think it is.

For us this risk is actually quantifiable, as the corresponding Y2 level is currently at 4185, which is 202-points away (4.6%), which should at the very least give you something to put into your models.  

  

Range:            4355  to  4430           

Activity:          Poor

Type:              On balance bullish

 

The faction account of the Big Bang, The Great Storm and the market crash of 1987, available in eBook and paperback here, a must read if you don’t believe in history repeating itself.

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July 28th, 2021 by Richard

Is Y2 Ratio fighting a losing battle with the SPX?

 

Nb. Our comment from the 07/21/21

 

It has certainly been an exciting start to the August expiry, but regular readers should not have been at all surprised.

Although it is a shame, as back in the day, throughout the rollover week (last week) we would publish daily the expiring month on the left and the upcoming month on the right, in the table above.

This always gave more of a sense of how the upcoming front month was shaping up.

Our only moan is that the market, once it gets below its zone, doesn’t bounce off Y2 – even our step-up level was just below 4200.

Anyway, a lot of the recent fallout was courtesy of Europe, and didn’t the FTSE break out of its zone crying “freedom at last”. Although it was perhaps not the freedom many expected.

Getting back to the August SPX and only today have they brought it up to speed (adding 75 strikes no less), which just goes to show how incredibly underdeveloped it was before.

However, the first couple of days of this expiry have shaken a few awake, so activity has been good, today not so much, and overall, it’s still dismal.

This leaves the Y1 ratio bandwidth at 235-points, and the complete Y ratio bandwidth 460-points, so these moves are only to be expected.

In fact, so much so that should we not be seeing these moves it would then be more of a worry.

We suspect it is going to feel like a very long five-week expiry, as it is really the same old song that we have seen and heard for the last several expiries, with the only prospect of breaking this monotony might be the next triple coming up, September.

 

Range:            4305  to  4405           

Activity:          Moderate

Type:              On balance just bearish

 

   

Nb. Our comment for 07/28/21

 

The exciting start to this expiry, as having scrambled straight back into bullish territory like a scalded cat, it continued on its upward trajectory.

Which was really the least we would expect, having found being below its zone so distasteful.

The first real ratio test came last Friday 23rd August when the market hit Y2 for the first time.

And it did a very reasonable job of stemming what was a very strong tide at that time, as having been as low as 4233.13, by the time it hit 4405, this was a rally of 172-points, or 4.06%. The high was 4407.54 for almost 2 hours.

And in just 5 trading days, so that is some momentum behind it, so, hence, good job.

Obviously, the market then hit a new all-time-high, which is always difficult to compete against, that day, and again on Monday, but only managing to add just 10 more points to Friday’s level.

The drop yesterday was significant, but also because it ended below 4405.

Interestingly, today is the first time that Y2 has fallen, and as you can see from the table above, it is now standing at 4415.

Overall, the picture remains much the same as the Y1 ratio bandwidth has increased slightly, but the overall Y ratio one has decreased.

Also, there is blatantly far more ratio below than above, revealing a fairly obvious path of least resistance.

Adding to all this is that the zone will move up to 4345-4355.

We could see the next four-weeks of this index knock knock knocking on the retreating Y2 ratio door, after all it wouldn’t be the first time. But, please do not loose sight on the fact that it continues to sit atop an abyss of ratio, and one which continues to not want to fill in behind the rising market, which is a real worry.

 

Range:            4305  to  4415           

Activity:          Moderate

Type:              On balance bearish

 

Available to buy now

The faction account of the Big Bang, The Great Storm and the market crash of 1987, available in eBook and paperback here, a must read if you don’t believe in history repeating itself.

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July 21st, 2021 by Richard

We would be more surprised if the SPX wasn’t this volatile.

Nb. Our comment from the 07/19/21 (Not published)

 

Nb. Our comment for 07/21/21

 

It has certainly been an exciting start to the August expiry, but regular readers should not have been at all surprised.

Although it is a shame, as back in the day, throughout the rollover week (last week) we would publish daily the expiring month on the left and the upcoming month on the right, in the table above.

This always gave more of a sense of how the upcoming front month was shaping up.

Our only moan is that the market, once it gets below its zone, doesn’t bounce off Y2 – even our step-up level was just below 4200.

Anyway, a lot of the recent fallout was courtesy of Europe, and didn’t the FTSE break out of its zone crying “freedom at last”. Although it was perhaps not the freedom many expected.

Getting back to the August SPX and only today have they brought it up to speed (adding 75 strikes no less), which just goes to show how incredibly underdeveloped it was before.

However, the first couple of days of this expiry have shaken a few awake, so activity has been good, today not so much, and overall, it’s still dismal.

This leaves the Y1 ratio bandwidth at 235-points, and the complete Y ratio bandwidth 460-points, so these moves are only to be expected.

In fact, so much so that should we not be seeing these moves it would then be more of a worry.

We suspect it is going to feel like a very long five-week expiry, as it is really the same old song that we have seen and heard for the last several expiries, with the only prospect of breaking this monotony might be the next triple coming up, September.

 

Range:            4305  to  4405           

Activity:          Moderate

Type:              On balance just bearish

 

Available to buy now

The faction account of the Big Bang, The Great Storm and the market crash of 1987, available in eBook and paperback here, a must read if you don’t believe in history repeating itself.

Posted in Uncategorized Tagged with: , , , , ,

July 13th, 2021 by Richard

Everything now on the move in the SPX, Yay.

 

Nb. Our comment from the 07/07/21

 

If the first week of this expiry was all about the SPX getting back to its zone, then the second week was all about finding out where Y2 was.

As one can see from the above table, this is now 4355, which is where the intraday highs of the last two trading days were.

Fridays came in at 4355.43, while Tuesdays was 4356.46, which was also the open.

Therefore, it was not surprising, to us at least, when the market recoiled from this encounter with Y2, although the bulls are evidentially resilient judging by the bounce.

While looking at the above table, noticing the increase in the ratios below the zone as well as the decrease above, then this suggests a bullish market.

This is true, of course, but again to us this is rather by default than design, as the bandwidths are actually exactly the same.

The Y1 ratio bandwidth remains at 235-points, while the overall Y ratio bandwidth is steadfast at 410-points.

The zone itself is also likely to move up.

The best analogy we can come up with is that the market is like an automatic car in neutral, designed to creep ahead (or at least steady on an incline).

The overall lack of ratio, also denotes a very undecided market.

There is very little else we can add, as the way the ratios are behaving is translated as bullish, and that is about the extent of it.

However, the lack of players participating is a very troublesome aspect, as is, should anything rock the boat, the corresponding Y2 (support) ratio doesn’t come into play until you get down to 4120, a full 5.41% below here.

Enjoy, but just don’t fall into the trap of believing this is a one-way street.

 

Range:            4255  to  4355           

Activity:          Poor

Type:              Neutral

 

 

 

Nb. Our comment for 07/13/21

 

All we can say, is thank goodness the zone has eventually moved as we getting a tad irked having to repeat it every comment.

However, it is worth noting the level of activity, as it is not only the same as yesterday’s, which are both a marked improvement on recent levels, but more importantly it is the “type” that has eventually broken the impasse, and so much so, we are very likely to see it move up again, as 4345-4355 is now staking a claim.

Although, this is still below the current market, it is not that far away in reality.

And, if our analogy of the SPX being like an automatic car (please see above) where we mention “at least steady on an incline” we are of course referring to when it encounters Y2, or what we have called in the past, “a speed bump”.

Although, last Thursday, when the market fell 68.76-points before recovering, was a very visible example of our “one-way street trap” (again please see above).

Apart from the fact it fell down to circa 4300, which was the then zone, before recovering, it was obviously the catalyst that this market needed to gear up for the rollover and expiry this week.

With the zone moving up, naturally the ratios below have strengthened while above weakening but, this is not as bullish as it may appear at first glance.

We say this because, the Y1 ratio bandwidth has gone from 235 to 260-points overall, while the Y ratio bandwidth itself has grown from 410 to 460-points.

Out of interest, Y2 did move to 4380 yesterday, from 4355, so this market is still being sensitive to it.

And that is the entire market in a nutshell, as it may still be an automatic car encountering a retreating speed bump as it grinds forward leaving a void behind it, but we are still just talking about Y2, there to display small changes such is its sensitivity, which just highlights the utter lack of overall participation.

 

Range:            4305  to  4405           

Activity:          Average

Type:              Bearish

 

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