SPX , NDX & DJX Ratio Table 7th August 2018
Of course, it is no coincidence to us that the SPX closed at 2850.40, which was exactly where R1 was.
So, the big news today is that it is now at 2855, although in reality this doesn’t actually change much, if anything.
The long and the short of it is that the SPX is challenging, or absorbing, the futures selling created by dynamic delta hedging to the tune of R1, which means there are bulls out there, so the only question that remains is are they bullish enough to buy them all?
The fact the market closed right on the line means it is 50:50 at the moment, and please bear in mind where the DJX closed, so today is a really big decisive day, will the bulls be bold enough or will it slip back into the safety of its Y ratio bandwidth?
Range: 2805 to 2855 or 2855 to 2875
Type: On balance bearish
No coincidences in the NDX, but being left to its own devices it is certainly making full use of its Y1 ratio bandwidth.
Don’t forget this expiry it has already be down to 7150, and here it is, just a week later mind, staring down the other end of this bandwidth.
A rather cool 300-points, 4.2%, in just seven days.
The only change here is its zone which has moved up a bit, but all within the Y1 ratio bandwidth, so not very compelling, especially as neither of the Y2 levels have changed.
So, in itself the move up is bullish, but without the corresponding firming of the ratios below and weakening of them above it does tend to look more administrative than directional, even more so when one considers the level of activity.
However, even being ignored is not going to affect it, probably in fact encourage it, so unlike the other two here it doesn’t have to decide until 7475.
Range: 7375 to 7475
Type: On balance bullish
Exactly the same as the SPX here in the DJX so therefore, of course, it is no coincidence to us that the DJX closed at 25502, which is exactly where the upper boundary of their zone is.
The difference between the two is that firstly the boundary hasn’t shifted like R1 in the SPX, but probably more importantly is that last week the DJX attacked this level on three consecutive days, so yesterday makes strike 4.
Therefore, the bulls are evidently far more active here, but after that it remains the same, as they still have to buy those futures shaken out by the dynamic delta at the top of their zone.
Although, after four attacks one does have to wonder how much can possibly be left to cause a problem?
Range: 24500 to 25500 or 25500 to 26000
Type: Not bearish