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

It’s a good move in the SPX for sure but we are certainly not getting excited by it unlike many others.

Basically to us it has just drifted upwards towards its NZ, which is default mode really, and it spent all day struggling to get above the bottom boundary at 2470.

Considering its potential to cut loose in the Y ratio this “rally” has been boring and almost begrudgingly.

However now it is within its zone hopefully we will get a zone bandwidth test.

The bearish news is 2445-2555 is making a serious move to being the next NZ.

Range:            2470  to  2480

Activity           Moderate

Type:              Neutral

The NDX’s NZ has indeed returned to 5875-5925 but it is different this time as the last move prompted the market to fall whereas this time the market move has resulted in the zone moving.

It did open up 15.84 points at 5948.74 so it was below Y2 initially and the first test was repulsed, not far but certainly enough to notice, and a couple of hours later they tried again and evidently succeeded.

We are only talking Y2 in a triple expiry but whatever has been the driving force we have seen no evidence of the big players so for us it hasn’t been derivatives led, but now each step forward they will have to plough through Y2 and this should reveal how determined they really are.

Range:            5925  to  5975      or        5975  to  6100

Activity:          Moderate

Type:              Bearish

If you recall the DJX in the first quarter and how it went ballistic, charging ever onward up through any ratio level as if they weren’t there, then yesterday was not even in the same ballpark.

So we do see it as a drift upwards rather than tax “incentivised” rally and all now within the Y2 ratio bandwidth so no issue with any ratios either, and more likely NDX inspired, and as we mention above they now have it all to prove.

In fact 55.67 points under these circumstances is not really anything but it is interesting that we are seeing money coming off the table.

Range:            21600  to  22200 

Activity:          Moderate

Type:              On balance not bearish