Category: Uncategorized
November 10th, 2017 by Richard
FTSE and DAX Ratio Table 10th Nov 2017
And right on time everything starts getting exciting for the rollover.
For the FTSE perhaps not so much as having failed to hold above its zone as soon as it was back inside the bottom boundary was beckoning.
The fact it only got as low as 7476.89 does not show any great desire to do so and we suspect that given the option it would prefer to stay inside and avoid the test if it can.
However, the closing low so far for this expiry is 7447.21 with the auction only adding 2.45-points, but close enough, and it was Y2 then as well underneath.
Range: 7450 to 7550
Activity: Very poor
Type: Bearish
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Well if the DAX had any doubt as to what ratio might be in their way then there is not anymore.
Actually, our surprise is that it was only 200-points, so for us that is still exhibiting remarkable constraint.
There are a couple of aspects to watch out for and the first is the possible move in the NZ, and it is very surprising that it hasn’t already done so, and this may act as a buffer just like the move in the SPX’s helped there.
Secondly activity has remained low which suggests lack of involvement which can limit distances.
Range: 13050 to 13650
Activity: Very poor
Type: On balance not bearish
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Posted in Uncategorized
November 9th, 2017 by Richard
As defining days go in the SPX it was a bit half-hearted but by ending up above Y2 it made its choice in the end.
And it was definitely this markets choice as it was not given any help from elsewhere.
However, let’s not lose sight of the fact we are talking just Y2 and with the rollover looming that should really not be hard at all.
It does throw up the interesting possibility that being poised now just 15-points above its NZ upper boundary it could just take baby-steps from now until Wednesday.
We suspect given the choice it would but we also suspect this is not going to be one that they will be allowed to make.
Range: 2555 to 2605
Activity Moderate
Type: Bearish
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In the NDX this one-way bet appears to be continuing, at least judging by the level and type of activity.
There is also a third measure which is the ratios themselves, and indeed these are again stronger below the zone and weaker above it.
As we know this index has traded in the “uncomfortable” Y2 ratio bandwidth so Y1 should not hold any fears so it, just like the DJX, has a huge Y1 ratio bandwidth stretching from 6100 up to 6400.
The main difference is that (now) all the activity seems concentrated in this index.
Range: 6200 to 6400
Activity: Very strong
Type: Bearish
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The big question here in the DJX is whether or not the high of 23575 was a test of the upper boundary or not?
It is right on the outer limit for us so we are going to say no it wasn’t.
The real issue here is that this index carries the greatest risk to the SPX’s equanimity.
Regardless of the zone here it is the Y1 ratio bandwidth that is the concern as with even the slightest inclination it could erupt to 24000 or implode down to 21800, so we suspect the decision as to what sort of rollover we can expect will be made here.
Range: 23400 to 23600
Activity: Moderate
Type: Neutral
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Posted in Uncategorized
November 9th, 2017 by Richard
Totally mundane day with the FTSE camped back inside its zone.
To be fair we thought it would enjoy the freedom of zero ratio more after the previous couple of days, but although it hasn’t really moved perhaps what it has done is to entice some fresh money back onto the table.
The ratios below the zone are restored to where they were previously, whereas above the zone we see Y2 for the first time.
Which means, should it go back there, it will find it a lot easier now.
Range: 7450 to 7550
Activity: Average
Type: Neutral
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The ratios continue to build below the DAX’s zone and weaken above it and from tomorrow we should start seeing some movement in the zone itself as well.
This has left this index back in the Y1 ratio bandwidth so just to clarify this currently stretches from 12850 up to 13450 and when you add Y2 to this it is 12700 to 13650.
This index may be being very sensitive currently but aggression is no stranger here, as is using up the entire bandwidth, the only difference is here it took QE to achieve what Trump has Stateside, but both are in a remarkable similar situation now.
So, before we hit the rollover it is perhaps worth reflecting on the fact that this index opened at 13014 on the first day of this expiry and even then the Y ratio bandwidth went from 12650 up to 13250.
Range: 13050 to 13650
Activity: Moderate
Type: On balance bearish
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Posted in Uncategorized
November 8th, 2017 by Richard
SPX , NDX and DJX Ratio Table 8th Nov 2017
It is very probably going to be a defining day for the SPX.
Basically, it spent so long breaking up through Y2 at 2585 that it was a relief when it did so, but since last Friday all it has done it try to break back down through it with yesterday’s low 2584.35.
So, big changes today, and the move in Y2 for once eclipsing the expected rise in the NZ.
The fact Y2 now stands where the market closed means yet another of those coincidences we so appreciate but more importantly which side will today end up on?
Range: 2555 to 2605
Activity Poor
Type: On balance just bearish
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Of course, the NZ in the NDX moved yesterday, although we are sure its moves are not yet over.
Especially considering the ratios continue to strengthen below the zone, and perhaps worth noting Y2 today was the zone last week, and weaken above it.
The high yesterday was 6328.58 but whether Y2 here moved intraday it’s impossible to tell, and anyway it has been above it for so long it really should not have any issue with it anymore.
High levels of activity continue and again it looks like everyone is on a one-way bet.
Range: 6200 to 6325 or 6325 to …..
Activity: Very good
Type: Bearish
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It has been a stupidly long time that the DJX has seen the inside of its NZ which just adds one more sign of normality returning to this index.
There is no precedent for how this index has been reacting to whatever economic elixir of tax or growth promised by Trump so there is no knowledge we can apply to our numbers.
However, it is also rare anything bad happens marketwise in the run up to Thanksgiving.
All we can say is that we used to use the ice-rink analogy in the NDX, where a little impetus can go a very long way, and that is certainly the case here now.
Range: 23400 to 23600
Activity: Strong
Type: On balance bearish
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Posted in Uncategorized
November 8th, 2017 by Richard
Again, the FTSE really struggled with R1, and again only getting as high as 7582.85 before capitulating.
The market did try very hard to hold onto the upper boundary and it only really gave up in the last hour.
So that makes 2 closes on the line (within 5-points) and 2 closes outside its zone, so far this expiry, but even those two were hardly very far away, so only just count.
The ratios are weaker below the zone but again we are now back to it all being about the zone.
Range: 7450 to 7550
Activity: Average
Type: Neutral
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Was the high of 13525 a test of R1 in the DAX yesterday, probably, but not definitely?
Of course, the ratios above the zone continue to weaken, which makes that call even harder, although the high was first thing so if it was then that is when it would have to be we suspect.
It is heating up as we saw a 156-point daily range, and we really can’t add more to the fact that this market could literally go anywhere, and in the next 8 days, so buckle up.
Range: 13050 to 13600
Activity: Very poor
Type: Neutral
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Posted in Uncategorized
November 7th, 2017 by Richard
The astute might have noticed in the SPX that the low was 2585.66 yesterday, or in other words Y2.
We haven’t had Y2 in our daily trading range from the start of this expiry, but have mentioned it every day so it has been most certainly implied.
More importantly the ratios today have given up what they gained yesterday and in respect of R2 above the zone slipped further.
Again 2570-2580 looks likely to be the next NZ, which of course will be important a week tomorrow, but in the meantime, this would just narrow the daily range while we wait for that all-important test of R1.
Range: 2555 to 2605
Activity Poor
Type: On balance just bearish
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Perhaps the simple truth behind the DJX’s “inactivity” is because all the attention is back with the NDX.
And the last few days are very similar to what we might expect in the final few days of an expiry.
The NZ jumps again and despite the ratios continuing to tumble above the zone the market still starts in Y2, which is more importantly now the highest level left, so all limits are off.
We should mention what we call the delta ratio is currently 29.7% here, which is very low.
Under 50% we say it is very bullish, but when we get down to these levels it just comes across as everyone’s on a one-way bet.
Range: 6200 to 6300 or 6300 to …..
Activity: Outstanding
Type: Bearish
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We are at a loss as to why the DJX is so quiet as it looks to us that everything is now in place.
Everything that is apart from activity and it is always difficult to see what will be the catalyst here.
One such thing in the past has been a move in the NZ and again today 23300-23500 states its case, but today it has been joined by the old front-runner 23200-23400.
Weirdly it could be both making a zero-ratio bandwidth of 23200 up to 23500 and that would certainly put an end to ten or twenty-point moves.
Range: 22700 to 24000
Activity: Only just registered
Type: Bearish
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Posted in Uncategorized
November 7th, 2017 by Richard
The O, H, L and C just do not do justice to how long the FTSE fought with the upper boundary of its NZ.
It seemed touch and go all day whether it would manage to stay above it and even now we are back to where we were with the open today once again being crucial.
The ratios are easier across the board with the biggest mover being B1 above the zone, but that would only come into play if this market got above DR and judging by how it is coping with just R1 we don’t see that as being likely at all.
Please remember what we said about 7600 as that may yet be an issue.
Range: 7450 to 7550 or 7550 to 7650
Activity: Very good
Type: On balance definitely not bullish
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Yesterday R1 was at 13450 in the DAX and just like London (and 7550) it really never strayed far from this level all day.
It did try to use the initial strength on the Street as a springboard but it always seemed rather half-hearted.
However, don’t get fooled as the ratios above the zone continue to tumble, which makes this current level of sensitivity somewhat ironic, but so much so there is no R2 anymore and R1 slips to 13550.
Again, to use our phrase clear skies indeed. In fact, it is clear both ways. Just saying.
Range: 13050 to 13550
Activity: Good
Type: On balance definitely bearish
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Posted in Uncategorized
November 6th, 2017 by Richard
And right on cue the SPX has indeed upped its game, although its Friday victory over Y2 was hardly emphatic.
Nevertheless, it managed to close above it which will hopefully provide it with a bit more belief as well.
Also, as we mentioned that everything should start to build this week as we head towards the rollover and expiry the week after.
And just to get the ball rolling today we have got a firm signal that 2570-2580 wants to be the next NZ.
A rising zone is always bullish and anyway now it is above Y2 we would fully expect it to test R1 anyway, so this is just a bonus.
Range: 2555 to 2605
Activity Average
Type: Neutral
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As we said on Friday in the NDX “In fact, from here on in we may well see the zone start to move up, completing the trifecta”.
As you can see it has today and the ratios continue to be stronger below the new zone and weaker above it and all three are bullish, and there is still 2 weeks to go.
Despite it still exhibiting the signs of trading in an uncomfortable market it seems very happy to adapt to it and seems quite relaxed about being in the Y2 ratio bandwidth.
Range: 6250 to 6375
Activity: Strong
Type: Bearish
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On Thursday last week the SPX did nothing leaving this index, the DJX, to take on their problem level 23500 on its own.
So, to repay the favour the DJX did nothing on Friday leaving the path clear for the SPX to tackle its problem area 2585.
Adding to the collusion it also looks likely that we could see a rise in the NZ here as well, to possibly 23300-23500.
Furthermore, we cannot stress enough that there is so little ratio here we should be seeing daily 1%+ moves and as we build towards the rollover this is going to become ever more likely.
Range: 22700 to 24000
Activity: Average
Type: Bearish
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Posted in Uncategorized
November 6th, 2017 by Richard
Officially the open in the FTSE is always the same as the previous close for some reason known only to themselves, but in the real world we had it up.
The market then managed to get itself as high as 7580.95 but it was obviously making heavy weather of it and no wonder as it had to wade through R1 ratio, which was a new experience for it this expiry.
Of course, there is still that wall of DR ratio waiting for it but we should mention that 7600 is just below the R2 threshold today so if the market goes there it may well have an impact.
We think it should as it fought (again) so hard towards the close (again) to get back and stay above 7550, which also makes today’s open crucial (again).
Range: 7450 to 7550 or 7550 to 7650
Activity: Moderate
Type: Bullish
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Rather bizarrely the 40-point move in the DAX on Friday has proved rather crucial.
As the ratios above the zone continue to fall, although the rate of change has slowed considerably, this move kept it in R1.
For what it is worth this makes the open critical, although this index doesn’t seem to mind R1 at the moment.
With this in mind this index now has a 1000-point trading range between the two R2 levels with the fun two weeks here, so hang on.
Range: 13050 to 13450 to 13450 to 13750
Activity: Average
Type: On balance only just bearish
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Posted in Uncategorized
November 3rd, 2017 by Richard
Today marks the halfway point for the SPX in this expiry and this week just gone is often rather tepid.
We know it is currently being sensitive to Y2 but we also know that it has tested this level on numerous occasions and been to the bottom boundary of its zone, so all it actually needs is a bit of aggression, or emotion.
The point we are making is that from here on in we very much doubt these are going to be in short supply as at the very least next week will build towards the rollover, and this rollover is into the biggest of the big.
Range: 2555 to 2605
Activity Average
Type: On balance definitely bearish
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Basically, the NDX was a rerun of Wednesday just offset by 25-points.
The open was 6238.30 so we will call that 6225 which would make the bandwidth 25-points either side or 6200 and 6250 and the low was indeed 6194.58 and the high 6243.74.
Not as close as we would like but also one has to add in that the low was also a test of Y2, so strike 1.
In the meantime, the ratios continue to strengthen below the zone and weaken above it both of which are bullish.
In fact, from here on in we may well see the zone start to move up, completing the trifecta.
Range: 6200 to 6350
Activity: Moderate
Type: Bearish
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Looks like the reconnaissance patrol in the DJX not only went back out to 23500 and found no resistance but set up a forward OP.
We suspect that this is entirely down to the fact that the SPX never even went back close its Y2 level leaving this index on its own.
Obviously, we have no axe to grind as to us it is all Y1 now and so our only moan is why this index is only taking baby steps, but also our comments above in the SPX apply here just as much.
Range: 22700 to 24000
Activity: Moderate
Type: Bearish
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Posted in Uncategorized
