SPX battle rages within the massive Y Ratio bandwidth.

Fantastic battle raging in the SPX helped, or because of, all the Y Ratio.


Nb. Our comment from the 09/09/20


We sincerely hope you took heed, as this is exactly the result the market was extremely vulnerable to.

In fact, we think it did exceptionally well to hold in the R2 ratio bandwidth for just over a day.

We did tweet yesterday the fact the zone had changed, as it eventually, and expectedly, moved up to 3345-3355.

Which, had you been aware, would have made interpreting yesterday’s market movement very interesting, as the low after the initial burst of selling was 3345.

Or, to put it another way, the first support it found, was the bottom boundary of its new zone.

Decent rally ensued, before it spiked down again, and again, right on 3345.

Considering that this also represented a drop of 81-points, meant that this was despite the considerable impetus it had.

After that the market rallied, to the intraday high, before the final capitulation in the closing stages.

But, significantly, closing below its zone.

So today is sort of the last chance saloon for the bulls, well, for a bit at least.

The good news is that all the ratios are better below the zone, and R1 down here now starts at 3095.

The bad news, is that this is now the target, unless the bulls use the support generated by the zone to stage a fightback.

Both good and bad news, is that the entire Y ratio bandwidth, having started at 435-points wide, went out to 510, but is now just 425.

So not nearly so bad, but still excruciatingly wide, the consequences of which we have just seen.

Therefore, the bulls hope the zone’s support works, but bears not, simple as.


Range:            3095  to  3345         

Activity:          Poor 

Type:              On balance only just bearish




Nb. Our comment for 09/11/20


We really ran out of space, rather than omit, to tell you, back on the 9th, that the moves in the zone were likely far from over, and that 3395-3405, was looking bit of a shoe-in.

As with everything in hindsight, this was a mistake, as not only did the bulls put up a fight, this is exactly where the market rallied to.

But not only that, it changes the complexion of it all, especially in light of yesterday’s fall.

Of course, when it moved, it gave a strong signal, and target, to the bulls.

But, when the market failed to hold, it also gives a lot more credence to the bears, as if the zone was still at 3345-3355, then yesterday’s drop was just in keeping with where the natural market gravitational forces would direct it.

However, now comes the really difficult part, as both, or either, could still be the zone.

It will take a day or so, for one or the other, to cement its claim, and as it is rollover and expiry next week, we are plumb out of time.

The only way we can think of understanding/explaining this situation, at least for today, is to think of the zone going from 3345 all the way up to 3405.

Normally, this would be an amazing 60-points worth of zero ratio, astonishing in a triple really, but as markets are just so weird at present, we do not think that this will make that much difference, bizarrely.

In these brave new times, we still have a Y ratio bandwidth of 410-points, inside of which, the Y1 ratio bandwidth stretches for 260-points, so calling 60 of those zero, when they are already just above absolute minimum, will not make a great deal of difference we suspect.

Aside from this, worth noting is that below the zone the ratios (apart from R2 & R3) haven’t changed, but above, they have strengthened, which is a first for this expiry, and, therefore, very noteworthy.

The upshot is, that bears are in control, and flexing their muscles, but when it comes to next week, anywhere in this ridiculously massive Y ratio bandwidth, is absolutely fine, so big moves, whipsaw and volatility are the name of the game, enjoy.


Range:            3095  to  3395         

Activity:          Moderate

Type:              On balance only just bearish


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September 11th, 2020 by