Category: Uncategorized
July 19th, 2017 by Richard
What a fantastic save by the FTSE yesterday, impressed us at least.
The low was 7357.77 so no doubt a test of the lower boundary and it was not so much the resilience and desire to stay in its NZ shown but that it did so when the rest of Europe was in freefall.
It is the rollover today so it has pretty much achieved the perfect expiry from the high of 7561.07 which was R1 and the top of its NZ then, all the way down to R2 at 7300 (low 7303.46) then finishing back in its zone for the rollover.
The only slight fault is it was R1 to R2 rather than identical levels, but as R1 was at 7350 when the market hit its low there was not a lot in it.
Range: 7350 to 7450
Activity: Moderate
Type: Bullish
Actually one of the reasons that this is becoming a textbook rollover is we have not seen any evidence of the “amber gambler” this expiry, so no sudden last few days large trades distorting things effectively.
The ratios are pretty much better across the board in August so below the zone most levels have come in slightly whereas above the zone we have lost R2.
After today we get the grey area where neither and yet both expiries are in charge and if the market has been held inside its NZ then this pressure is released so it should be interesting over the next few days.
Range: 7250 to 7450
Activity: Average
Type: On balance bearish
As we said in the DAX yesterday; “the low was 12542 so this was a test of the lower boundary making yesterday’s range (high 12656) a NZ bandwidth test which would ordinarily result in a breakout today”.
Furthermore the previous day we mentioned it had achieved their zone too early resulting in three closes very tightly grouped (12626, 12641 & 12631) and then Monday’s at 12587 and that is a very tough ask to hold such a big index inside a 0.80% range for so long.
No changes in the ratios today and being the rollover it will be a tough task to get it anywhere back even close to its zone.
Range: 12300 to 12550
Activity: Poor
Type: On balance just fractionally not bearish
No movement in the NZ here and the signal has if anything reversed, but still early days as the ratio here is most certainly a work in progress.
However with all the excitement going on in July it may be worth considering that here all the market has done is move around within its Y1 ratio bandwidth, and not by very much considering how wide it still is.
Like London the range here in July was not like to like as it peaked at Y2 when it was 12950 (high 12951) and went on to test R1 at 12300 (low 12316) and now only time will tell if it manages to regain its zone today, but it would be a shame having worked so hard over the previous 4 days up to Tuesday.
Range: 12300 to 12650
Activity: Moderate
Type: On balance just bearish
Posted in Uncategorized
July 18th, 2017 by Richard
We always say that when a ratio drops, as in the SPX’s R1 level yesterday, then the old level can still carry a residual impact as generally it has only just dipped below the threshold.
Although the high yesterday was 2462.82 we do not think that was affected by the R1 level from Friday, 2465, that knocked the market back then, as it was a very sedate approach and it fell short of Friday’s high, so no strike 2 even if the R1 had moved to 2470 yesterday.
Of course today it is 2475 and still backed by R2 at 2480 so it will be very interesting if it goes there today.
Range: 2430 to 2475
Activity: Moderate
Type: On balance bearish
Hardly any changes to the ratios in August, in fact only one which is R1 below the zone comes in to 2370.
In July this index spent most of its time above the zone but with R1 not starting until 2495 here then it will have a lot more scope, well 65 points to be precise.
The real question is whether or not it will go for the zone for tomorrow or will it be happy in the low Y1 ratio?
Range: 2430 to 2495
Activity: Average
Type: On balance bearish
The moves in the NZ for the NDX are coming thick and fast now, especially with the rollover imminent, and today it has jumped a decent length to 5725-5775.
This still places it a significant distance below the current market but we don’t think the moves may be over yet but this does now place the spotlight on the step-up levels.
On Friday it was 5850 (high 5844.80) and yesterday it was 5875, which is still the case today as it happens, but the market only got up to 5860.64 so perhaps there was still bit of a residual affect from Friday’s level.
We mention this as not only can they affect the markets progress but they also show where the NZ may move up to, so as they started at 5825 the highest the NZ can go, unless the ROC accelerates that is, would be 5775-5825.
Range: 5775 to 5925
Activity: Average
Type: Bearish
Rather interestingly the August NZ has also moved up slightly to mirror July’s.
This really just highlight how very thin the ratios are currently in August so there is no doubt that as things stand even after tomorrow we suspect July will still be the dominant force.
The zone may have changed but nothing else has so it actually needs to up the activity levels as we are back to small pebbles in small puddles make big waves relatively.
Range: 5775 to 6125
Activity: Good
Type: Neutral
The ratios in the DJX are stronger below the NZ and weaker above it, which is bullish, and means below Y2 comes in to 19100 whereas above Y2 slips out to 22100.
In the scheme of things all very small and we are only talking Y2 so it should be active as it is there for that very purpose, to easily identify the trend or direction.
The real issue is that the NZ hasn’t budged and today we have had activity, although judging by what has happened it is best described as not just quite enough to get it back to its old level.
This in itself is worth remembering as that was 21300-21500 so even if it does flip back this market would still be over 100 points above it.
Range: 21100 to 22100
Activity: Average
Type: Not bullish
The only difference in August is that we see the appearance of R3, but overall there is still a huge predominance of Y ratio.
Again activity looks okay but it is also a case of a small pebble in a little puddle makes relatively large waves.
The main aspect is the NZ here is holding out at its original level lending a little bit of support to July should that decide to return to this level.
Range: 21500 to 21700
Activity: Strong
Type: Bullish
Posted in Uncategorized
July 18th, 2017 by Richard
HRA Rollover FTSE 18th July 2017
First we must say that somehow the low yesterday was 7378.30 which means at some point the FTSE was down 0.09 point, and no we didn’t see it either so where that came from who knows as in the real world the market opened up going like a steam train and from what we saw never even looked back.
Anyway the ratios are easier across the board, much more so above the zone which has thrown up an intriguing possibility of the NZ actually moving back to 7450-7550.
However with the market now very close to the centre of the current one and acting like it belongs and is exactly what it has been working towards, with just a day to go, if it happens it will certainly shake it all up and then some.
Range: 7350 to 7450
Activity: Moderate
Type: On balance only just not bullish
Although if the NZ does change in July it will match Augusts’ so there may be more in it then the market is letting on.
The ratios here are better across the board and pretty much uniformly although the only one to change is R3 below the zone that moves in to 7000.
Of course this expiry rarely influences proceedings until rollover Wednesday and after and as this is an intermediary rollover here it is still very much still on the developing pathway.
Range: 7250 to 7450
Activity: Average
Type: On balance only just bearish
Posted in Uncategorized
July 17th, 2017 by Richard
HRA SPX Rollover 17th July 2017
Y2 only held the SPX back for perhaps 20 minutes on Friday, which is as it should be and why we call the Y ratios minimal.
However the markets have been acting incredibly sensitively so it is wise to be aware of them but also remember it is still just a Y ratio.
However the high was 2463.54 so we have no hesitation in calling that a hit of R1 which was at 2465 and today has slipped to 2470 significantly.
This overall is more normal behavior for a market, test the boundary’s before settling back into their NZ for the Wednesday rollover, so for us it is just a question of what it will take this expiry, R1 or R2?
Range: 2430 to 2470
Activity: Average
Type: Bearish
The first look at August is rather exciting as it seems to be opening out considerably.
However firstly two main aspects jump out, and the first and very important for Wednesday, is the NZ’s are in sync, and secondly, it is glaringly obvious there is a lot less ratio above the zone than below it.
Generally this is very good for the bulls but it is still early days so a lot will change although these foundations look promising.
Range: 2430 to 2495
Activity: Average
Type: Neutral
Posted in Uncategorized
July 17th, 2017 by Richard
HRA Rollover DAX 17th July 2017
The real problem for the DAX is it went too early and now it has to try and hold onto its NZ for the next three days, which would make a week and in market terms being static for so long is very unusual.
The last three closes have been 12626, 12641 and 12631 just to underline the point.
On Friday the high was 12662 so no doubt this was the third test in a row of the NZ’s upper boundary and so for us it already on borrowed time, and we are only talking Y1 here as well so this makes its resilience even more impressive.
The only ratios to change are the appearance of R1 below the zone and Y2 moves in to 12450.
Range: 12550 to 12650
Activity: Moderate
Type: On balance not bullish
Just like London here in the DAX the August NZ is 100 points above the current expiries.
However one major difference is here there is 700 points of Y1 ratio so the potential for this zone to move is enormous.
Just to remind that this index is a notorious slow starter so this lack of ratio is not unusual, and when one factors in it is a rollover between intermediary expiries then this is actually more normal than not.
Although it does point to the possibility of a rather volatile index for this expiry and so far in July the DAX hit Y2 at 12951 to give the expiry high and the low was R1 at 12300 so that was 650 points and between those same points here it is a mouth watering 1000 points.
Range: 12250 to 12650 or 12650 to 12750
Activity: Average
Type: Neutral
Posted in Uncategorized
July 14th, 2017 by Richard
HRA Table US 14th July 2017
All very lackluster yesterday and it seems even the SPX was waiting for someone else to make the first move.
By which we really mean the decision making DJX and the lack of anything from that direction left this index becalmed, only managing a 8 point daily range.
However activity is ok so it does just looks like a pause and the first test of the bulls commitment will be when or if it tests Y2 at 2455.
Range: 2430 to 2455
Activity Moderate
Type: Neutral
The NDX just like the SPX above shied away from a test of their step-up level, which is still at 5825 but not as potent as it was, only getting as high as 5806.18, this leaves 5850 as the heir apparent.
Again today the ratios are a lot firmer below the zone and easier above it until you get to the R ratio where it has actually come in a bit.
However just above the zone they have fallen so far that we now get the situation of a potentially upwardly mobile NZ, which unusually has only had one minor move so far this expiry.
In the last 5 sessions this index has put on almost 200 points and yet only now is it getting to the most minor ratio based resistance possible, and the way the ratio is currently developing is very bullish so all that remains is a matter of belief having come so far already.
Range: 5675 to 5875
Activity: Strong
Type: On balance bearish
You are on a rope swing that goes a long way out over the ocean and just as you let go of the rope when it is at it furthest point the tide suddenly recedes and you are left momentarily suspended staring at a rather hard landing a long way down or praying that it comes back in before you reach the beach.
This is exactly what has happened in the DJX as on the back of the highest activity so far this expiry their NZ has fallen to 20900-21100, which is a long way down.
Range: 21100 to 21900
Activity: Very good
Type: Neutral
Posted in Uncategorized
July 14th, 2017 by Richard
HRA Table EU 14th July 2017
Last trading day before the rollover starts and the FTSE is safely inside its NZ, which could easily mean it stays here for the next few days until Wednesday, but that is a tough ask not to mention rather boring.
However having made the bold move on Wednesday yesterday was bit of a non event with a total daily range of just 25 points, so staying within this 100 point bandwidth could in fact be made to appear to be quite exciting.
There are a few caveats one of which is the ratios have tumbled below the zone although on the surface the only mover is DR slipping to 6850, but it has thrown up an outside chance of 7250-7350 being the next NZ, and all this despite activity by our measurements being zero.
Range: 7350 to 7450
Activity: Did not register
Type: N/A
The DAX was easily the more aggressive out of these two as it tried very hard to break out above its NZ.
This was very early on and it got as high as 12676 before it gave in or perhaps up and then it did spend a lot of the remainder of the day around 12650 so it seems the bulls may not have succeeded but they haven’t retreated very far.
This index does have acres of Y1 above the zone so it’s not really a big ask and as we said its high was against Y2 when that was at 12950 so it has coped with Y1 before, but it is also the rollover next week and where it wants to be on Wednesday may influence proceedings here as well.
Range: 12550 to 12650 or 12650 to 12850
Activity: Average
Type: Bullish
Posted in Uncategorized
July 13th, 2017 by Richard
The move yesterday in the SPX was more like the breakout so we are putting the scare on Tuesday down to being just that and then the move on Wednesday was the result of the NZ bandwidth test on Monday.
Emails are still pertinent these days it seems.
Interestingly Y2 hasn’t changed much above the zone at all, effectively it has been either 2450 or 2455 and so far the high this expiry is 2453.82 on the 19th June although it did get back up to 2450.42 on the 26th.
Therefore our first target is Y2 at 2455 but as we said the decision seems to be with the DJX so please see our comments below.
Range: 2430 to 2455
Activity Moderate
Type: Bearish
Not only is the NDX’s stall set out they are selling like hotcakes as the 1.21% move yesterday proves and it hasn’t even yet come close to the step-up point.
The open was a gap up of 48 points so it made its intentions obvious from the start and with potential moves like this a bit of forewarning is almost essential especially as it only managed to add a further 20 points during the day so no doubt where the bulk of the move came.
The step-up is still at 5825, but remember it is only one within the Y1 ratio bandwidth, but Y2 slipping to 5875 shows weakness in the ratios above the zone so a rising market into falling ratios is always a good sign.
Range: 5675 to 5875
Activity: Moderate
Type: On balance bullish
Now comes the real test for the DJX as this is their first close outside their NZ for well over 2 weeks, which is a very long time indeed where markets are concerned.
For us the recent dearth of activity flowed by a small flash yesterday combined with today’s does not look like it really wants to be here.
In fact the improvement we saw in the ratios below the zone yesterday is a bit like one step forward and then today is two steps back.
Of course only time will tell and it has a very decent Y1 ratio bandwidth to play in so it is therefore just a question of whether or not they actually want to.
Range: 21300 to 21500 or 21500 to 21900
Activity: Average
Type: On balance only just not bearish
Posted in Uncategorized
July 13th, 2017 by Richard
As we said all the FTSE needed was a friend, or perhaps fair weather as above 7350 it was clear skies.
Officially the open was the same as the previous close, 7329.76, but in the real world it was above 7350 and our only surprise was it stopped just short of going the whole way to the upper boundary, only getting as high as 7439.08.
All right on cue as well as we fully anticipated it all warming up for the rollover next week.
Perhaps worth remembering for almost the first three weeks of this expiry the zone was 7450-7550 and the high this expiry was 7561.07 back on the 20th June.
Range: 7350 to 7450
Activity: Very poor
Type: On balance bearish
Right on cue here as well and as we also said all it needed was a little spark in the DAX and it could easily move 1% to 3% in a day.
Also we have said this a few times before this expiry but both these indices are in sync it’s just that everything is much bigger here, so to achieve the same the distance it has to travel is just that much greater.
Perhaps the one difference is that the high here was 12648 so no doubt this was a test of their upper boundary.
Here of course the zone in the first few weeks was 12750-12850 and the high was on the same day as London’s at 12951 or Y2 which was then at 12950.
Range: 12550 to 12650
Activity: Poor
Type: Bearish
Posted in Uncategorized
July 12th, 2017 by Richard
The SPX did try to breakout but it seems the decision does still rest with the DJX, please see below.
Having been down almost 15 points it reversed as soon as any strength was shown elsewhere and the ease with which this was achieved reveals that if a breakout was intended it wasn’t backed with much, if any, conviction.
Furthermore the rebound towards the end of the day took this index all the way back to the top boundary of its NZ, getting as high as 2429.30, before finishing dead center, again.
Therefore again if a breakout was intended and a shock/surprise sent it the wrong way then this opportunity to break out the other way was also spurned, so again no great conviction revealed, in fact the exact opposite.
Range: 2420 to 2430
Activity Poor
Type: Not bearish
For the NDX which made its breakout on Monday after Friday’s NZ bandwidth test evidently the surprise/shock wasn’t very much for them as at the worst hey only gave up 26.88 points.
However more to the point the low was 5667.27 so it was the top of their NZ that was providing support as the bulls didn’t want to let the market break back into it.
Therefore they are still in an ocean of Y1 and even the step-up does not appear until 5825 so barring any more untoward events this index seems to have set its stall out.
Range: 5675 to 5850
Activity: Strong
Type: On balance definitely bearish
Hold the front page as activity comes charging back into the DJX, and what is more enough to change things around a bit.
Of course unlike the market so far but as the refusal by this index to entertain the notion of entering bear territory turned all three, the low being 21279 or the bottom boundary of its NZ, it shows that the decision still rests here, and emphatically so.
Therefore the big changes are Y2 below the zone jumps significantly, but is still a ridiculous distance away, whereas above the zone Y2 slips to 21900 and we lose R1 altogether.
Range: 21300 to 21500
Activity: Average
Type: Bearish
Posted in Uncategorized
