One would be forgiven for feeling a sense of Déjà vu in the SPX as Wednesday was virtually a repeat of Tuesday.
However for us there is one massive difference which is although the SPX repeated itself this allowed the DJIA to get back into line as remember on Tuesday when it hit R1 it retreated but this index did not, so yesterday just balanced the books as it were.
Although there is another massive difference today in the SPX which is their NZ has eventually moved, however it has taken so long now 2470-2480 is making noises too.
The other major aspect is Y2 has slipped slightly giving this index just a little more headroom, but at the end of the day it is still a Y ratio so the decision we feel still rests elsewhere.
Range: 2455 to 2505
Activity Very good
Type: On balance only just bearish
For the NDX again there has not been very much movement in their ratios, but what there is involves Y2 and below it comes in slightly whereas above it slips slightly.
The July expiry was a lot about the step-up in the ratio and it seems this has carried forward into this one as the first step-up we get here is at 5950, and of course Y2 was at 6000 yesterday so that today is just below the threshold so this index also has to now fight if it wants to continue ahead.
However we must point out that we are only talking about a step-up within the Y1 ratio so if it is to continue to have an effect it must rely on a very sensitive market.
Range: 5825 to (6000) / 6025
We have to recognise the effort the DJX made yesterday against R1 as it was with distinct purpose.
Having opened like a steam train on Tuesday and hit it headfirst getting knocked back so severely it took all the wind out of its sails for the remainder of the day to then go back the next day and get as high as 21742 shows a concerted effort.
From the open at 21690, up 77 points, it made its intentions obvious and we suspect the open again today is going to be critical.
This would be strike 3 but it is also a very high ratio level for this index to take on, more so as for the last few months it has not displayed aggressiveness of this degree at all, so it would also be bit of a sea change for them.
So another big day and with the SPX poised on Y2 it is not alone in having to now absorb some futures to progress.
Range: 21500 to 21700 or 21700 to 21900
Activity: Very good