SPX line in the sand, NDX back in Y1 and DJX crystal, today’s levels and comment


Pragmatism seems to have set in on the SPX as with equities going a bit tax mad the derivatives have had to adjust quite quickly.

The upshot of this is the Y ratio bandwidth continues to expand but it seems a bit of a line in the sand has been drawn at 2705.

As one can see from the table above it jumps from Y2 straight to R2 and as these are exponential that is a big leap, which on an ordinary intermediary expiry would have us calling that the top.

However, not only is there this tax issue but also the potential mayhem with truncated markets over the holiday period so we are not that convinced, but it might be well worth noting that the nearest R ratio in the other direction is a whopping 160-points away.


Range:            2605  to  2705

Activity           Very good

Type:              On balance only just bearish



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It seems to have calmed down in the NDX as well and with the market closing near to yesterday’s Y2 level it gave it a fighting chance.

As it happens Y2 has slipped so that the fall combined with this weakness means the market is back inside the Y1 ratio bandwidth.

However, there is no disguising that Y2 has been beaten and that is all there is still, so as things stand this index won’t help anybody’s case in either direction.


Range:            6325  to  6525

Activity:          Good

Type:              On balance only just bearish



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Well that couldn’t be more crystal for the DJX as with the loss of Y2 above the zone it is now just Y or B, so it couldn’t be easier to remember.

In this mood earlier on in the year on bad days it was known to test the upper boundary of its NZ, but it never closed inside let alone below, and used the support generated by that to reinvigorate the bulls.


Range:            24500  to  24900 

Activity:          Poor

Type:              On balance only just bearish



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December 20th, 2017 by