Again, we wish the table above for the
NDX had been published back on the 20th, as just like the SPX and
the DJX there were significant ratio levels that had to be contended with.
For the NDX it was right from the very
start, as on that very first day this index closed right on Y2 at 7325.
And 7325 has been the constant theme for
the past two weeks, and if you knew it was where Y2 was, and hence all that
futures activity, then the last two weeks would have made a lot more sense.
Monday 18th the close was
7326.28, next day’s intraday low was 7321.93 having opened nearer 7360.
Wednesday’s intraday low was another
test, being 7318.42, then it tried to break free, but as you can see the ratios
were just not shifting, so by Friday it was back to Y2 with the close at
7326.06.
Of course, that was the day it dumped
167.21-points, so it probably would have been nice to know, that just like
London, it was an accident waiting to happen.
Although, having fought through the hard
yards, it is worth pointing out, and please see our previous commentary on this
subject, that the Thursday immediately before this big dump, the DJX was
hitting the top of their zone, intraday high 26009, and the SPX was meddling
with R2, with their intraday high of 2860.31.
This week, 7325, has been significantly
involved as well, suffice it to say Monday’s close was 7316.96 and yesterday’s
7320.47.
Nevertheless, at the end of the day,
here we are at the midpoint of this expiry, which incidentally, closes a day
early, and the ratios are still seriously underdeveloped.
So, just like the DJX, if this index
gets a head of steam up, which is very possible in the run up to the rollover
and expiry, it really could motor.
However, with R1 lurking up at 7600, and Y2 now in-between, it will find life a lot easier going south than it will north, but the bulls have already set out their stall, getting it as high as 7505.41, so they will have to be taken out first, and with the lack of ratio meaning a general lack of interest, that may not be so easy in itself.
Range: 7225
to 7325 or 7325
to 7600
Activity: Moderate
Type: Bearish
Nb. Comment on 04/12/19
The bulls had indeed set out their stall
and yes, indeed, they did get a “head of steam up”.
Actually, and on the very day we
published last, as you can see the previous close was 7320.47 from the left-hand
column in the table above, but that Friday the market gapped up at the open to
7377.77.
But the real defining moment was when it
came back down to Y2, with the intraday low of 7333.17, and the fact it bounced
off Y2 meant the bulls really were back in the saddle.
Of course, we don’t know exactly when R1
slipped from 7600, but we suspect it was only recently as the intraday highs
from the 3rd all the way through to Tue 9th of 7589.69,
7571.13, 7581.90, 7602.08 and 7596.75 suggest it didn’t give way until
Wednesday.
All very punchy, but what we said above,
back on the 29th March, is just as relevant today; “and the ratios
are still seriously underdeveloped….. and with the lack of ratio meaning a
general lack of interest, that may not be so easy in itself”.
The only difference this time round is
that next week it is the rollover and the expiry, so time is very short indeed,
and as it’s a long weekend quite a few will probably get going early.
At the end of the day, there is still so little ratio about the zone will move northwards no doubt, and substantially so, but nevertheless this index should be seeking the Y1 ratio bandwidth, at least, by the rollover.
