Category: Uncategorized
October 6th, 2017 by Richard
Nice to see the SPX being a bit more proactive and rather than stop as soon as it encounters R1 yesterday saw it push past for the first time, and stay above.
To be fair the ratios above the zone have been in full retreat so it’s not as brave as it seems, but it does show a greater degree of boldness.
Needless to say, again today it has slipped, but R2 very importantly hasn’t, so they are now neighbours, and this may well come as a surprise.
Worth noting that today it is not just one-way traffic as below the zone we see the return of Y1.
Range: 2480 to 2555
Activity Very poor
Type: Bearish
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The raw data does not do justice to how hard the NDX had to fight to get over our step-up level of 6025.
It really was quite a titanic battle made all the more interesting as at that time the DJX was heading south.
Anyway, the winner is obvious but we have seen the ratios strengthen above the zone, and for that matter below, but the end result is the market and Y2 have passed both going in opposite directions.
This makes today’s open crucial and also how willing this index will now be in the Y2 ratio bandwidth?
Range: 5975 to 6050 or 6050 to 6200
Activity: Moderate
Type: On balance only just bullish
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It was quite a strange start to yesterday as initially the DJX fell, and quite dramatically so, and to compound things the opposite happened in the NDX.
Of course, we were the other way around in both but after this shaky start the market soon continued on its normal course.
It does have Y2 dead ahead but of course it is the R ratio that concerns us more and basically this will decide whether or not this index is going to return to normal.
Range: 22500 to 22900
Activity: Average
Type: Bearish
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Posted in Uncategorized
October 6th, 2017 by Richard
The FTSE grew a pair after all and set the scene from the very start exploding up to just below R3.
It took a knock back fair enough then slowly rallied back to just below hoping for a helping hand from the Street.
Whether or not they got it they just couldn’t break through until the very last minutes of real time and with the auction adding 5.2 points it made it look easier than it was.
We have absolutely no problem with markets breaking through ratio levels, in fact quite the opposite as it is confirmation of the strength of the move. However, these last two breaches have been almost by default, sneakily even, and although they obviously work they do not look natural. Same hurdle to face at 7550 of course.
Range: 7450 to 7500 or 7500 to 7700
Activity: Moderate
Type: Bearish
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The DAX yesterday spent the entire day centred around R1 which was then at 12950.
It has been a very long time since we have seen a negative open but we got one yesterday, down 20 points right at 12950 and from then on it only went 19 points to the good and 17 points easier resulting in one of the narrowest daily ranges we have seen, and on such a large index as well.
The ratios continue to tumble above the zone, so much so the next NZ could be anywhere within the Y1 ratio bandwidth, but the net result is this index is now back within the Y ratios.
So quiet and narrow it shouldn’t be and it is still on a cliff edge but ahead is just a gentle slope now.
Range: 12550 to 13050
Activity: Moderate
Type: Bearish
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Posted in Uncategorized
October 5th, 2017 by Richard
So far every day this week the SPX high has been R1, literally to a decimal point, as it has slipped back.
Great for us as it is a perfect example of the ratio in action although we would be the first to admit it is a tad boring.
Exactly the same scenario again today but no changes below the zone, and the persistent weakness above now brings 2495-2505 into the frame as the next NZ.
However the most important aspect is what this behaviour reveals about this index and it is obviously happy going higher and not a bear in sight, otherwise they would seize on the opportunity when the market hits R1, but conversely the bulls are not paying to get through R1 and so it’s on repeat until one of the others change the picture we feel.
Range: 2480 to (2540) / 2545
Activity Moderate
Type: On balance bearish
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Again yesterday the NDX was all about the negative as for the second day in a row it has tested the upper boundary of its NZ.
On Tuesday the low was 5976.65 and yesterday it was 5976.12 so if it goes back there again today that would be strike 3.
Two other noteworthy aspects in this index and the first is tremendous activity, which also suggests they think something is imminent, and interestingly it is the opposite of the DJX.
Secondly they have thrown into the mix some new strikes, why beats us especially as they are 400 points away from the current level, bizarre.
Range: 5975 to (6025) / 6075
Activity: Very strong
Type: On balance definitely bearish
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No change in the DJX today but we suspect it will still be the catalyst for all the markets, and quite possibly today as well.
Basically activity is of such magnitude and one sided that if anything is going to kick off then this suggests it is imminent.
It is still about 1% to get to the R ratios here so if they do force the pace it will be the other two that hit their levels first, assuming the NDX doesn’t have intentions of its own of course, so it could be a grandstand end to the week.
Range: 22500 to 22900
Activity: Very strong
Type: Bullish
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Posted in Uncategorized
October 5th, 2017 by Richard
We would like to revise yesterday’s comment in the FTSE “hardly aggressive but above is above regardless and no matter how they won the bulls deserve it, if only for persistence and perseverance” to no they don’t deserve it.
Basically to go to all that trouble to get above the upper boundary and then just languish in a 10 point range is just ridiculous.
Ok the range was 20 points with the low of 7456.61 but this was a test of the upper boundary that they did on about 5 occasions throughout the day in little spikes so we are referring to the bulk of the eight and a half hour trading day.
The ratios below the zone are firmer, with the loss of R1, while above slightly weaker with no changes.
Range: 7450 to 7500
Activity: Moderate
Type: Bearish
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For the DAX it really was an inverted pyramid day as they started off like a steam train which hit the buffers shortly after it opened up 53 points at 12955.
It fell all the way back to R1, which yesterday was at 12900, with a low of 12893 before spending the rest of the day recovering to its morning high.
As you can see the market closed above the new R1 level reinforcing its position within the R1 ratio bandwidth and meaning this index is indeed comfortable with this level of ratio it seems.
R2 is but an open and a bit away and that is the last hurdle facing this market, or at least domestic, as if it copes with this then the only potential blot on its horizon would be from the States as it is plainly happy to ignore London.
Range: 12550 to 12950 or 12950 to 13050
Activity: Average
Type: Bearish
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Posted in Uncategorized
October 4th, 2017 by Richard
Good morning SPX. Activity has come crashing back in and with it a bit more engagement we hope.
Yesterday R1 moved from 2530 to 2535 and that really summed up what this index did yesterday.
As you can see today it has slipped to 2540 so the market is meeting the resistance and as it capitulates it is crawling along behind it and the reason why the DJX powered ahead yesterday as it didn’t have this problem.
On its own it can be brave but when one or the other, or both, start hitting their resistance levels it may well be a different story.
Worth noting R2 has slipped today but R3 has come in, so it has actually strengthened, and all are getting close now.
Range: 2480 to (2535) / 2540
Activity Very good
Type: On balance only just bullish
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Although the NDX ended the day positive it really was all about the negative yesterday.
By which we mean (despite the DJX) this index was heading south until it hit the upper boundary of its NZ, getting as low as 5976.65, and failing to break through it the market rallied.
Significantly the market came nowhere near the step-up level which is still at 6025.
It is just a step-up and as we said it is a considerable one but it is probably going to come down to how close the other two are to their levels as futures selling across all three at the same time does tend to get noticed a lot more.
Range: 5975 to (6025) / 6075
Activity: Strong
Type: Bearish
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It is early and there is no maths behind this but we said yesterday “are we going to actually see the return of the prodigal?” and we think we are as the makeup of the activity just looks different now.
Returning swiftly to fact based analysis the aforementioned activity has maintained its high levels but the only ratio to move is 22700 which drops to Y1 leaving 22800 as the last bastion of Y2.
However this index had no problem moving ahead and was happily ploughing on when it eventually noticed the other two were not, and in fact were slightly easier.
This led to bit of an impasse but that big R ratio is drawing ever closer and if that bullish stubbornness so prevalent this year is dissipating it could make for a very interesting meeting.
Range: 22500 to 22900
Activity: Good
Type: On balance not bullish
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Posted in Uncategorized
October 4th, 2017 by Richard
We have to profess to some surprise in the FTSE as they have managed to close above their zone, but bravo.
For the first couple of hours it looked like they were scared of it, then they camped out on it for about the next 5 hours, and eventually managing a little spike in the closing half hour or so.
Hardly convincing or aggressive but above is above regardless and no matter how they won the bulls deserve it, if only for persistence and perseverance.
However R3 is now waiting to ambush them and it may also be worthwhile considering where every other market is in relation to their ratios.
Range: 7450 to 7500
Activity: Average
Type: Bearish
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Of course the DAX was closed yesterday so just to repeat the pertinent parts for today; “as you can see it has moved today (R1), as has R2, but it is now just a question of whether or not it is comfortable taking on the R ratios and on yesterday’s evidence no it is not but currently it also doesn’t want to take a backward step, which is probably just as well as it is on a cliff-edge”.
Again we should repeat what we say above as it may not be this index’s choice alone as London is pushing up against some serious levels of ratio and in the US they too are either walking up the path or knocking on the door of ratio levels that will be noticeable.
Range: 12550 to 12900 or 12900 to 13050
Activity: Moderate
Type: On balance bearish
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Posted in Uncategorized
October 3rd, 2017 by Richard
Yesterday certainly rattled the SPX cage as we at last have some ratio movement.
It does look far more dramatic than it is courtesy of losing Y1 below the zone, but the obvious strengthening of the ratio here is a bullish sign.
The most important move however is R1 slipping to 2535 this market having tested it at 2530 yesterday getting as high as 2529.23.
Having just changed it will still pack a punch being just below the threshold, but the weakening of the ratio above the zone is also a bullish sign.
So bullish signs but whether they are convinced enough to take on the R ratios is the $100 question, and nothing so far this expiry to suggest they are but nothing like a decent test to force the hands out onto the table.
Range: 2480 to (2530) / 2535
Activity Moderate
Type: On balance bearish
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The NDX evidently does not want to give up its spotlight so it too has waded in with a surprise NZ move, which changes their ratio landscape considerably.
The new zone is obvious enough and it will make for a rather crucial open today.
However below the zone the ratios are bizarrely easier with both Y2 and R1 giving ground which is rather unusual when the zone moves up.
Above the new zone the ratios are conventionally easier, although R1 hasn’t actually moved, but more importantly this relegates 6025 back to being just a step-up, albeit a rather large step.
Range: 5925 to 5975 or 5975 to 6075
Activity: Moderate
Type: On balance bearish
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Very exciting times for the DJX and are we going to actually see the return of the prodigal?
And if the SPX’s cage was rattled here it was measured on the Richter scale and yes we have the NZ move, and to exactly where it should be.
Typically this index has stayed just above it but now it is so close we suspect the remainder of this week is going to be very revealing.
Range: 22300 to 22500 or 22500 to 22900
Activity: Good
Type: Bearish
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Posted in Uncategorized
October 3rd, 2017 by Richard
The FTSE went down 0.03 point yesterday, apparently, so we can only speculate they are messing with the algo’s again.
More importantly it took full advantage of the freedom of its NZ, and quite rightly, but as we said R2 and the upper boundary of their NZ is going to be a tough hurdle.
However until that cold slap of reality hits they are certainly having fun as at the other end the closing auction (up about 8 points) took it to their high of the day as well.
Excluding this bizarre -0.03 we get one of those unique to London days where just 2 prices cover 4 levels being the open, high, low and close, so rock ‘n roll FTSE.
Range: 7350 to 7450
Activity: Moderate
Type: On balance only just bearish
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The DAX has let the side down as although their closing auction added points (about 6) but it only took the market back to its real time high and not a new one like the rest of Europe.
However for this index Monday was all about R1 which was at 12850 and their open (up 38 points) leapfrogged this at 12866, and then shortly after they hit their real time high and then slowly sank back to R1 with the low of 12849.
As you can see it has moved today, as has R2, but it is now just a question of whether or not it is comfortable taking on the R ratios and on yesterday’s evidence no it is not but currently it also doesn’t want to take a backward step, which is probably just as well as it is on a cliff-edge.
Range: 12550 to 12900 or 12900 to 13050
Activity: Moderate
Type: On balance bearish
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Posted in Uncategorized
October 2nd, 2017 by Richard
The SPX is slowly changing up through the gears and Friday was a decent performance but hardly electric.
However now we are getting somewhere and as we said “R1 next stop” and this is just over ten points away now and should provide the first real test for this index.
Part of the problem is we are not even at the halfway stage of this 5 week expiry and even though last week seemed bullish enough it certainly has not stimulated activity.
The main change is R2 slips a notch but 2540 is only just below the threshold so should still pack a punch as we like to say.
Range: 2480 to 2530
Activity Very poor
Type: On balance bearish
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The NDX did breakout of its NZ on Friday but it did require quite a bit of effort.
The open was 5941.78 just below the upper boundary which it then went on to test, got knocked back to the low of the day, rearmed and had another go an hour or so later and then took another hour camped on 5950 before it finally broke free.
The trouble is the scenery has changed considerably since it was last here and 6025 rather than being just a step-up is now a solid Y2 and represents a considerable jump from the Y1 ratio bandwidth it currently finds itself in, so game on as they say.
Range: 5950 to 6025
Activity: Moderate
Type: Bullish
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The DJX is just being a little tease although like the SPX the lack of any meaningful activity is certainly exacerbating matters.
The firm favourite to be the next NZ is 21300-21500 which is now definitely in front and almost there.
Hopefully when this happens this index being in the middle of a 200 point bandwidth of zero ratio will start getting back to the 100 or so point daily moves.
Range: 21900 to 22700
Activity: Only just registered
Type: Bearish
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Posted in Uncategorized
October 2nd, 2017 by Richard
Now that wasn’t so hard for the FTSE, well it did take an hour and a half at the start of the day so it did require some effort anyway.
Also quite a scare in the auction with the market dropping just before and then after the real time close it traded down to 7355, but in the end it added just over 3 points to leave it comfortably inside its zone.
Don’t forget this is a 5 week expiry so we are not yet at the half way mark.
London now has a decent trading range but we must point out that at the upper boundary, a hurdle in itself, lurks R2, and we saw how effective that was at 7250.
Range: 7350 to 7450
Activity: Moderate
Type: Bearish
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The DAX was massively flattered by their auction on Friday, which unlike London only had eyes one way as it added the rather impressive 21.06 points.
This also actually resulted in the high of the day, which of course we don’t think appropriate as it is not under normal open market conditions.
Nevertheless this now places R1 directly in the crosshairs and of course their open could easily swallow up those 22 points just so you are aware.
Also if it does have conviction, and it once used to take DR to turn this market, then the ratio only goes as high as R2, but judging by the type of activity and how hard it found Y2 to get over we don’t think it has enough, yet at least.
Range: 12550 to 12850
Activity: Good
Type: Bearish
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Posted in Uncategorized
