Nb. Our comment from the 07/18/2022 (Not published)
Nb. Our comment on 07/20/22
Firstly, our final comment on the July expiry where the zone did move down to 7150-7250, meaning that 7150 remained a critical level, but now for two reasons. The EDSP was 7134.13, so close and a sterling effort, but still a smidgen shy. Interestingly, the market actually closed at 7159.01.
So, the first day of the August expiry for the FTSE was all about its zone.
The fact that the intraday high was 7268.88 just hides the fact that this index had many hours in a running battle with 7250, the top boundary of its zone.
And as one can see in the table above, above the zone it is only Y1, so to hold the market back at all meant it was punching above its weight.
Worth noting is the fact, that as things stand, Y2 does not even start until 7450, so there is ample room for this market to go ahead into, if it so desires.
However, and especially for those who have read our comment on the SPX yesterday, the difference in the FTSE is that the corresponding Y2 and R1 ratio levels below the zone are 400 and 500-points away respectively.
That is a long way, particularly for this index.
This is also a 5-week expiry, so the first week can be deemed a bit superfluous, and if this is the case then we haven’t seen this expiry true colours yet.
All we can say, is that London has plenty of scope as things stand, to make a significant move, but in either direction.
The fact it has elected to go above its zone and into bullish territory certainly gives further moves in the same direction the upper hand, but don’t lose sight of the risks.
Range: 7250 to 7450