SPX , NDX and DJX today’s ratio levels and comment


The question is whether or not that was a test of Y2 in the SPX?

The high was 2578.29 and it was very quickly after the open but being only 1.71-points away we have to say it was.

This then gives us an indication of this index’s sensitivity, and it’s probably just as well that it remains so as there is still not a great deal of depth in the ratio above the zone.

We would hope to see this market gravitate towards its NZ, in fact better still to visit it, like the EU indices, but we suspect this may not be in its control.


Range:            2555  to  2595

Activity           Strong

Type:              On balance bearish



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The NDX actually opened up 13.42-points at 6122.24 but it didn’t take very long, in fact no time, as the open was also the high.

The odd aspect was shortly after as the upper boundary did not provide much of a barrier although the market did hover around just below it for the rest of the morning, then tested it from underneath before going on to make the low.

It is very reminiscent of the start of the last expiry and we certainly can’t complain about any market that finds itself in its NZ at the start of a new expiry as that is exactly how it should be.


Range:            6050  to  6100

Activity:          Very strong

Type:              On balance bearish



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There have been no changes in the ratios for the DJX despite continuing decent levels of activity.

One of the issues is that this expiry only started attracting interest in the last couple of days of the rollover, which ordinarily would have been fine had this index been acting rationally, but as it was so far from its zone it has just passed the problem on.

So, it is perhaps worthwhile putting everything into numerical perspective, and if the bulls continue to salivate over this tax deal then the next hurdle is not until 24000, 700-points away (3.00%).

The zone is now also 700-points (the other way) away, or 3.00%, which means a there and back round trip, which we would expect in a “normal” bull market, would equate to 6% in 4 weeks.

If it went searching for support below its zone, a range bound market, then R1 doesn’t appear until 21500 a mere 1800-points away.

And if this tax bubble bursts and it gets down there then we suspect R1 will not be nearly enough to hold it let alone turn it round.

It’s not a case of this will happen but sometimes it can be very constructive to know what the risks actually are.


Range:            22700  to  24000 

Activity:          Strong

Type:              Neutral


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October 24th, 2017 by