Category: Uncategorized
September 11th, 2017 by Richard
FTSE Rollover Sept to Oct 11th September 2017
What would the odds be for the FTSE to stay inside its zone for an entire expiry we wonder?
Very long as it is a virtual impossibility although Sept is going to run it very close we suspect, as so far we make it just one day it has closed outside and this is in the second biggest expiry of the year, making this all the more remarkable.
Of course our target is the market being inside their zone on the Wednesday rollover so it only needs to remain boring for a couple of days more but this in itself is going to be tricky as on Friday the low was 7358.42 which is strike 2 of the bottom boundary.
Range: 7350 to 7450
Activity: Poor
Type: Bullish
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The grey area of the front month is always critical to the heir apparent, this being the October expiry, but this is even more so this time round.
The reason is no Y ratio at all and this is all the more unique as it is so early on as well.
In normal circumstances going from a triple to an intermediary then everything tends to become more sensitive, so even the lower ratios have a noticeable influence, but here outside the zone they escalate very rapidly so to avoid another zone bound expiry it is going to have to get very aggressive.
Range: 7350 to 7450
Activity: Average
Type: Neutral
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Posted in Uncategorized
September 8th, 2017 by Richard
SPX , NDX and DJX Ratio Table 8th September 2017
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We said activity is the key in the SPX and today at last we are seeing some and with the rollover next week it could be setting itself up for a grandstand finish.
There are no changes to the pertinent ratios but what we can say is that a flip back to the old NZ is looking increasingly unlikely, which obviously has big ramifications for next Wednesday.
However the issue will very probably not be the SPX as it still has plenty of Y ratio to play around in and remains close to its zone, but in may well be forced out of its comfort zone by one of the others, most likely the DJX, and be forced to fight.
Range: 2455 to 2485
Activity Moderate
Type: On balance bearish
As we said yesterday in the NDX “but please remember 5975 still represents a considerable “step-up””, and the high was indeed 5980.15 so it certainly gave it a go.
The other good news is that activity has maintained its high level, although with the rollover next week we don’t think the really big players will visit this expiry now.
However it is of a far more balanced nature today one of the results of which is 5975 has regained its Y2 status, but the ratios are firmer across the board.
There is obviously the interest but now it is looking like a straight foot race between ambition and the rollover, and with 5975 so close the emphasis will be on the open.
Range: 5925 to 5975
Activity: Very good
Type: On balance only just bearish
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Even the DJX is now getting in on the action easily equalling the only other day to post decent activity, or quite frankly any of any significance.
Furthermore it has had a marked influence on the ratios with the loss of R2 above the zone, or to be more accurate R3 replacing it.
However this is the index that poses the greatest risk as it has only once tested its NZ’s upper boundary, at the very start of the expiry, so remains steadfastly above its zone with the rollover looming.
Last expiry we saw the SPX dominate the rollover and then the DJX rule the expiry and the situation this time around is not dissimilar.
Range: 21600 to 22100
Activity: Moderate
Type: Neutral
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Posted in Uncategorized
September 8th, 2017 by Richard
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The “real” open to us was above the close in the FTSE so the subsequent retreat back to the bottom boundary was far more pronounced than the bare data suggests.
However it held very firm (low 7348.38) so no doubt who won that fight and the result is a lot of changes apart from the market itself which remains steadfastly zone bound.
Below the zone we see Y2 appear for the first time in two weeks and above the zone we lose Y1.
The fact that B1 drops to 6950 shows how weak the ratios are below the zone and is a result of bullish confidence but as the rollover starts next week and this index has been dormant for so long it is just perfectly primed to get aggressive.
Range: 7350 to 7450
Activity: Moderate
Type: On balance not bearish
The DAX evidently has loftier ambitions and the gap up at the open of 70 points took it to 12284 vaulting the upper boundary.
It did come back to the upper boundary, the low being 12265, to test it before taking off and at one stage got as high as 12363.
This made us think of our forecast back on the 21st August at the start of this expiry “we very much doubt this expiry will be so sensitive but on the downside it goes straight from the Y ratios to R2 at 11950 so if it goes there this will prove to be a very significant level”.
Well we saw that low back on the 29th August and the corresponding R2 now sits at 12650, which is now no longer quite as farfetched although time is rapidly running out, so it looks like a nail-biting finish is in store.
Range: 12150 to 12250 or 12250 to 12550
Activity: Moderate
Type: On balance bullish
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Posted in Uncategorized
September 7th, 2017 by Richard
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It appears activity is the key to the SPX as yesterday it was rather disappointing after the big move on Tuesday, and today its worse.
So it reverts back to a 10 point trading range within the Y1 ratio bandwidth, which can only be described as boring, but to us is more reflective of the confusion.
The move down in the NZ was a surprise, especially as the market had only reached the old level, but it nevertheless reacted only to be faced with the zone switching back, so no wonder it is confused.
The answer to us is one should probably treat 2445 all the way up to 2480 as the NZ, which if the market does as well then hang on very tightly.
Range: 2455 to 2485
Activity Did not register
Type: N/A
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It was one of those decision days for the NDX yesterday and throughout the day we thought it could have gone either way.
The open was decently firmer, pretty much around where it closed however it was the high and low that were key.
Firstly the high didn’t challenge Y2, then at 5975, only getting as high as 5964.38, but the market certainly knew it was there from previous encounters so this was telling.
The low was 5909.92, which was back inside its NZ so it could have easily chosen to stay inside in “neutral” territory, but no it crossed back over its upper boundary, which is also telling.
Today the ratios are even more firmer below the zone and weaker above it, bullish, and more importantly Y2 has today slipped to 6025, but please remember 5975 still represents a considerable “step-up”.
Range: 5925 to (5975) / 6025
Activity: Very good
Type: Bearish
It is unusual for the DJX to take the back seat but again yesterday that is what it did.
In fact if its daily move, as a percent, has not been less than the SPX’s it has been the same and very rarely has it been above which is a total reversal from what we are used to seeing.
In comparison to the NDX it is no contest as that is where all the action and activity have been focused so far this expiry.
However just a day to go before the rollover so even if they don’t want to wake up that alarm clock is going to ring very soon and very loudly so they won’t have a choice.
Range: 21600 to 22100
Activity: Very poor
Type: Not bullish
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Posted in Uncategorized
September 7th, 2017 by Richard
FTSE and DAX Ratio Levels 7th September 2017
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Wow, what a good fight the FTSE put up, even we were impressed.
According to our reckoning the market did open still inside its zone (of course ignoring the “official” 7372.92) but very quickly fell below 7350 and into the R1 ratio.
It did rally (twice) but failed to break back up through it, then once again before the Street opened but finally succeeded only when the US was looking very firm and London had less than an hour to go.
Even then it only just managed to hold onto it so we suspect the fights not quite over and possibly not helped by weakening ratios below the zone, this shows up with the appearance of R2, which will make the “real” open crucial.
Range: 7250 to 7350 or 7350 to 7450
Activity: Very poor
Type: Not bearish
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However the praise must go to the DAX as it has achieved what it set out to do over a week ago, and in some style, so Bravo.
The open was always going to be weak and it did not disappoint falling 52 points to 12071 and then went on to 12066 and back to Y2, a level we saw was very effective on Monday with the low of 12050.
With a fair wind in their sails (basically the US) they didn’t make the same mistake from Tuesday and this time took it all the way to the NZ’s upper boundary, the high being 12260, which left them to finish in the middle of their zone and job done.
Today 11950 has been restored to R2 so it will really be a case of whether or not the target was always just getting back to their zone or do they have loftier ambitions?
Range: 12150 to 12250
Activity: Very poor
Type: Bearish
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Posted in Uncategorized
September 6th, 2017 by Richard
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Everything is getting very exciting in the SPX now with the market moving down to meet the new NZ yesterday.
This seems to have shaken it awake, although activity could do better, but the low was 2446.55 and as it was at the bottom of such a large fall there is no doubt that was a test of the zones bottom boundary.
The fact it closed above the upper boundary as well as the fact the NZ may well revert to where it was means we are probably just getting started.
The ratios are stronger below the zone and weaker above it with several movements, but this is also bullish, but at the end of the day it is now acting exactly as it should with so much Y ratio still around.
Range: 2445 to 2455 or 2455 to 2490
Activity Poor
Type: On balance just bearish
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For the NDX their NZ changed a couple of days ago but yesterday the end result was almost identical.
The low here was 5890.25 and although 15 points shy of the bottom boundary as it was down 97.65 points at that stage and falling like a stone we are calling that a hit, or at least their first encounter with any futures buying up to then.
It has also closed above its NZ and activity has been stimulated and as you can see from the table above there is no doubt that the ratios are firmer below the zone and weaker above it.
Range: 5925 to 5975
Activity: Very strong
Type: Bearish
The DJX is definitely the odd one out as so far this expiry it hasn’t been in its zone.
Even yesterday the low was only 21709, still just over a hundred points above its low of 21600 back on the 21st August.
Nevertheless now all three are just above their respective NZ’s so in that respect at least they are all now in sync.
Range: 21600 to 22100
Activity: Poor
Type: Bullish
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Posted in Uncategorized
September 6th, 2017 by Richard
It appears all very exciting in the FTSE but essentially going nowhere.
In fact once it sorted itself out at the very start of this expiry it has had just the one day outside its zone, and we are now into the third week….
There are no changes in any of the ratios, which sort of tells its own story, however the 7450-7550 tease to be the next NZ is back on, but it really would be a surprise if it actually happened.
Again we stress that it is the rollover next week and this is a triple so it would be a rare thing indeed if it stays this boring.
Range: 7350 to 7450
Activity: Very poor
Type: Not bullish
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We have to feel a little sorry for the DAX as they certainly gave it their best shot but in the end were scuppered by the weak Street.
The open was only up 23 points and at 12125 still below the bottom boundary of their zone but they soon rallied and powered on up through it to the high, 12210, which is the centre of their zone.
About midday they came back to test 12150, the lower boundary and were fine until the US started falling, but rather magnificently held onto a positive close.
The only ratio to change is R2 reverting to 11850 but the ratios are weaker below the zone and firmer above it, bearish, and having tried and failed it will make for a tough day today.
Range: 11950 / (12050) to 12150
Activity: Moderate
Type: Bullish
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Posted in Uncategorized
September 5th, 2017 by Richard
On Friday in the SPX we said “the bearish news is 2445-2555 is making a serious move to being the next NZ” and here we are coming back from the long weekend and wallop there it goes.
This is made all the more bizarre as it was actually inside the old zone, closing almost dead centre, and the high of 2480.32 was an almost perfect test of the upper boundary.
Overall the ratios haven’t changed it is just the NZ has moved within the Y1 ratio bandwidth, nevertheless it now takes this market into bullish territory without the need for another test of its upper boundary.
The flipside is that it is now above its zone and where previously it dragged the market up by default now the default position is gravitational.
Range: 2455 to (2480) / 2485
Activity Poor
Type: On balance bearish
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The question posed on Friday in the NDX was how committed the bulls were now they were into Y2 ratio and the derivative players were noticeable by their absence.
Closing virtually unchanged pretty much answers this question but there was a lot more going on under the surface, most notable of which for us is the return of activity.
However it is worth noting that the open was 6001.82 and the low was 5972.27 (or Y2) and if there is a lack of commitment this is what we would expect to see.
Range: 5975 to 6100
Activity: Good
Type: On balance bearish
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Activity in the DJX hasn’t really got going despite this being a triple but it has nevertheless resolutely stayed above its zone all expiry so far.
There was of course that test of its upper boundary on the very first day, the low being 21600 on the 21st August, but that is the lowest it has been.
However the one change in the ratios today is R1 above the zone comes in slightly, which also narrows our trading range, and neatly highlights that this index is now at the top of a 500 point Y2 ratio bandwidth.
Range: 21600 to 22100
Activity: Very poor
Type: Not bullish
Posted in Uncategorized
September 5th, 2017 by Richard
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Evidently Friday was enough of a fight for the FTSE with the upper NZ boundary at 7450 as yesterday it didn’t even go near.
In fact the open was the high (7438.50) but it really just didn’t look like it had any fight in it at all.
There is still the possibility of the NZ moving to 7450-7550 but slightly less so.
However do not get lulled into a false sense of security, or zone bound, as the rollover starts next week so we should see it build this week.
Range: 7350 to 7450
Activity: Very poor
Type: On balance only just not bearish
Monday broke the spell in the DAX bringing to an end its daily leap frog up the ratio table.
However, unlike London, here they seem to have taken the opportunity of a relatively quiet day (US was closed) to plan ahead and for a big triple this level of activity is very decent and as good as we have seen so far this expiry.
Also it is worth noting that where on Friday this index couldn’t break back into its zone, on Monday it opened down 91 points right on Y2 at 12051, and what’s more the low was 12050 so a solid test of this level that provided support.
In essence this was a Y1 ratio bandwidth test as the high was also 12138, so expect a breakout today.
For the record the ratios are firmer across the board with both R2 levels coming in a notch.
Range: 11950 / (12050) to 12150
Activity: Average
Type: On balance bearish
Posted in Uncategorized
September 4th, 2017 by Richard
To be honest we are puzzling why the FTSE is having so much trouble with its zone’s upper boundary.
On Friday it basically camped out on it all day with an hour’s excursion either side by 10 points (again please ignore the “official” open and low), and in fact the real time close was 7448.52.
There are no changes to the ratios today but there has been a lot of movement within them, the most significant is a major move by 7450-7550 to regain the NZ crown.
So if it goes near 7450 again not only would this be strike 3 but the decision may be taken out of the markets hands anyway.
Range: 7350 to 7450 or 7450 to 7550
Activity: Poor
Type: On balance definitely not bearish
The DAX continues to leapfrog its way up the ratio table, on Friday climbing from Y2 to the bottom boundary of its NZ, or the next rung up.
It did get as high as 12191 so it has been back inside its zone, presumably today if it continues this structured progression it will stay inside it.
Like London there are no changes in any of the ratios but unlike it there is not a lot of movement within them either, so there remains a great deal of Y ratio present as we enter the back 9 of this expiry.
As this week progress’s towards the rollover next week it will heat up and as the ratios have hardly developed from the beginning there is still a definite bullish ratio configuration.
Range: 11950 to 12150 or 12150 to 12250
Activity: Very poor
Type: On balance definitely not bullish
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