May 3rd, 2022 by Richard

That has been one of the hardest fights the FTSE has ever had to hang on to its zone.

 

Nb. Our comment from the 04/25/22

Looks like the lowly Y2 at 7650 provided enough dynamic delta futures selling to scare the FTSE into turning tail.

Although, it did take over half an hour at or around its intraday high of 7656.47 on Thursday 21st to make up its mind.

And, when you couple this with a weak Street overnight and then again on the Friday, you had the FTSE in a full-blown retreat back into the safety of its zone.

What is more, is that this expiry is still only a week old. So, plenty more time for some fun and games.

On the upside, Y2 has now moved out to 7700. Although, and as we said back on the 19th, the real test should come at 7750. Even more so now, as it goes up to R2 from R1.

Of course, this is assuming the bulls wrest back control. But, as we said, there is still three weeks to go, so plenty of time.

But first, we should see a test of the bottom boundary of the zone at 7450, Which is also strengthened by the fact it is also R1. The fact that there is no Y ratio at all below the zone should give any bulls out there an excuse, even if the dynamic delta inspired futures buying doesn’t do it for them.

If the bears are really in control, and R1 isn’t enough, then backing it up is R2 immediately underneath at 7400. The big concern will be if this is not enough, then there is a very long way before we hit the next level of support, R3 at 7150.

The other alternative is that the market could just stay zone bound, which is not unheard of. If it does decide to take this easy option, then it could bounce around excitedly within its zone for the next two weeks, only breaking out in the final week, which we have seen quite a lot of in the past.

 

Range:            7450  to  7550       

Activity:          Very good

Type:              On balance only just bullish

 

 

Nb. Our comment on 05/03/22

 

All of our assumptions last week were blown out of the water before the market even opened. Or to be more specific when the market opened circa 7387 on Monday 25th, as this was actually below R2 at 7400. Best lain plans and all that.

However, had one realised that the FTSE was stuck in the R2 ratio bandwidth, then the next few days made perfect sense as it tried to fight its way back up and out of it, despite the millstone of HSBC on the Tuesday.

The intraday highs of 7463.15 and 7458.24 on Tuesday and Wednesday respectively, just went to show how hard it was trying to break back into its zone.

Then the Friday was all about the upper boundary of the zone 7550, with the intraday high of 7569.80. So, in a way, last week was mostly all about the zone.

Looking ahead, and this time it will depend on the open as London not only has to react to Friday’s Street fall, but everything from Monday as well.

Despite all this we do still think that this index just wants to be in its zone, plain and simple. Well, at least for this week, as come the rollover and expiry everything tends to change anyway.

For the record R2 has now dropped to 7350, exactly when we of course don’t know, but this is immaterial now. However, going in the opposite direction are the other ratios below this.

Above the zone, the ratios have also strengthened, which means we have lost Y2, but at the same time above the zone is still the only place where we get any Y ratio at all. So, perhaps the scope has reduced now we have hit the halfway stage but, overall, the alignment remains the same.

 

Range:            7450  to  7550       

Activity:          Strong

Type:              On balance bearish

 

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April 25th, 2022 by Richard

After testing Y2 the FTSE retreated back to its zone, the question is, can it stay there?

 

Nb. Our comment from the 04/19/22

Firstly, a quick word about how the April expiry ended last Thursday, and the EDSP was 7582.04. So, it didn’t manage to get back in its zone, the upper boundary being 7550, but it came close, and it finished in Y1, so no great harm done.

Although, it was interesting to see the intraday lows on the last three trading days of this expiry coming in at 7543.03, 7550.94 and 7551.39 respectively.

Looking ahead now to the May expiry, and the first aspect to note is that the zone is at the same level.

Then the second major thing to note is that in May 7650 is only Y2. And, perhaps significantly, it is only just Y2, having crept over the threshold by just a little bit.

For the record, 7700 is a far more solid Y2, and is in fact at the other end of this bandwidth, being just below the threshold of R1.

And, by comparing the tables above you would be correct in thinking that activity has been towards the top end of the scale, reinforced as well by the “very strong” description below, but overall, activity is an awful lot lower than it was in the April expiry.

Although, April was larger than normal, so despite the difference being very noticeable, in fact, May is just a little bit below the historical normal. Nevertheless, we would have expected at least a large chunk of the April activity to rollover into May. It could still do so, but if it doesn’t, money coming off the table is never a good sign.

Otherwise, despite the market being above its zone, it now has a lot more room to manoeuvre to the upside, whereas below the zone it is nicely underpinned by there being no Y ratio at all.

 

Range:            7550  to  7750       

Activity:          Very strong

Type:              Neutral

 

 

Nb. Our comment on 04/25/22

 

Looks like the lowly Y2 at 7650 provided enough dynamic delta futures selling to scare the FTSE into turning tail.

Although, it did take over half an hour at or around its intraday high of 7656.47 on Thursday 21st to make up its mind.

And, when you couple this with a weak Street overnight and then again on the Friday, you had the FTSE in a full-blown retreat back into the safety of its zone.

What is more, is that this expiry is still only a week old. So, plenty more time for some fun and games.

On the upside, Y2 has now moved out to 7700. Although, and as we said back on the 19th, the real test should come at 7750. Even more so now, as it goes up to R2 from R1.

Of course, this is assuming the bulls wrest back control. But, as we said, there is still three weeks to go, so plenty of time.

But first, we should see a test of the bottom boundary of the zone at 7450, Which is also strengthened by the fact it is also R1. The fact that there is no Y ratio at all below the zone should give any bulls out there an excuse, even if the dynamic delta inspired futures buying doesn’t do it for them.

If the bears are really in control, and R1 isn’t enough, then backing it up is R2 immediately underneath at 7400. The big concern will be if this is not enough, then there is a very long way before we hit the next level of support, R3 at 7150.

The other alternative is that the market could just stay zone bound, which is not unheard of. If it does decide to take this easy option, then it could bounce around excitedly within its zone for the next two weeks, only breaking out in the final week, which we have seen quite a lot of in the past.

 

Range:            7450  to  7550       

Activity:          Very good

Type:              On balance only just bullish

 

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April 19th, 2022 by Richard

For the FTSE 7650 is no longer a problem as in the May expiry it is now only Y2.

 

Nb. Our comment from the 04/11/22 (Not published)

Nb. Our comment on 04/19/22

 

Firstly, a quick word about how the April expiry ended last Thursday, and the EDSP was 7582.04. So, it didn’t manage to get back in its zone, the upper boundary being 7550, but it came close, and it finished in Y1, so no great harm done.

Although, it was interesting to see the intraday lows on the last three trading days of this expiry coming in at 7543.03, 7550.94 and 7551.39 respectively.

Looking ahead now to the May expiry, and the first aspect to note is that the zone is at the same level.

Then the second major thing to note is that in May 7650 is only Y2. And, perhaps significantly, it is only just Y2, having crept over the threshold by just a little bit.

For the record, 7700 is a far more solid Y2, and is in fact at the other end of this bandwidth, being just below the threshold of R1.

And, by comparing the tables above you would be correct in thinking that activity has been towards the top end of the scale, reinforced as well by the “very strong” description below, but overall, activity is an awful lot lower than it was in the April expiry.

Although, April was larger than normal, so despite the difference being very noticeable, in fact, May is just a little bit below the historical normal. Nevertheless, we would have expected at least a large chunk of the April activity to rollover into May. It could still do so, but if it doesn’t, money coming off the table is never a good sign.

Otherwise, despite the market being above its zone, it now has a lot more room to manoeuvre to the upside, whereas below the zone it is nicely underpinned by there being no Y ratio at all.

 

Range:            7550  to  7750       

Activity:          Very strong

Type:              Neutral

 

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April 11th, 2022 by Richard

Huge ratio level just ahead for the FTSE but will the early expiry get in the way?

 

Nb. Our comment from the 04/04/22

This is a very skittish zone this expiry, as it makes yet another move.

This time it goes back up to 7450-7550, which means the level we highlighted last week as important, 7550, took on a joint significance. Last week it was just where R1 started but, what with the zone move, it also became the upper boundary of the new zone.

Again, we should calculate this daily, but as we don’t, we believe it is a fair assumption that last week’s obsession with 7550 was for two different distinct reasons.

At the start of the week, it was all about the dynamic delta caused by R1 but, by the end, it was all about the fact it was now the upper boundary. Which was quite unusual as a move in the zone should be quite rare in this index, and yet here we are at the midpoint, and this is move three already.

And it’s not as if these are small moves, this latest being a jump of 200-points.

Can we say these moves are over, sadly no. Although, it may prove to be significant that there is no more Y1 ratio around.

However, there is still 500-points of Y2 ratio out there, which is still a ridiculously huge amount, so the potential for big moves is ever present.

So, the good news is that if it can break out of its zone, then R1 now doesn’t start until 7650.

However, the bad news, again if it breaks out of its zone, is that R1 below the zone doesn’t now start until 7150.

And with two weeks still to go in this expiry, then there is plenty of time remaining, and who knows, we may even get another zone move.

 

Range:            7450  to  7550       

Activity:          Moderate

Type:              Bearish

 

Nb. Our comment on 04/11/22

 

At least the zone hasn’t moved again but, as last week panned out, the market never quite got away from it so it had every reason to stay put.

And it really was a week of concentrating on the intraday highs and the lows.

Firstly, the lows, and in order they were 7532.23, 7536.21, 7536.20, 7537.25 and 7551.81. So, every day the market was clinging to its zone, apart from the Friday when the low was just under two-points above the upper boundary.

Of course, surprise surprise, on Friday we saw the first test of R1 at 7650. In the morning it took 15 minutes of interaction before it fell back and waited for Wall Street.

Even then it was hardly convincing, and in real time the close was 7659.82, so it was the auction that took it back up to make its high of the day.

The fact that the significant ratios above the zone haven’t changed makes life a bit easier, as does seeing how hard the market found coping with the dynamic delta created by R1. And, don’t forget, this is test two, as the week before it also suffered at the hands of R1 when it was at 7550 (see comment above).

Therefore, make note that the next level is R3, which skips a level (R2) altogether, and as these are exponential, this will be like running into the proverbial brick wall, apart from the fact that the bricks in this instance will be futures selling.

On top of all this we are now into the rollover and expiry week. One that finishes on the Thursday, not the more usual Friday, it being a Bank Holiday. So, apart from a confusing rollover, which theoretically should now happen on the Tuesday, the gravitational pull of the zone should exert an influence.

But, for those traders out there, hopefully not before we get a sniff of R3 at 7700.

As an aside, we seriously hope we do, as in our opinion it would be a real travesty that the new all time high came about because of the closing auction, in other words, as a result of abnormal market conditions.

 

Range:            7650  to  7700       

Activity:          Poor

Type:              On balance only just bearish

 

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April 4th, 2022 by Richard

The FTSE zone moves yet again, but at least now R1 doesn't start until 7650.

 

Nb. Our comment from the 03/28/22

We did say the zone could move anywhere within that ridiculously wide Y ratio bandwidth, and it has.

We should, but we don’t calculate this daily, so we don’t know exactly when this happened but, guessing by the lack of impetus in the market from Wednesday onwards, we suspect it was then.

As, don’t forget, when it was at 7550-7650 it would have acted like a magnet but, once it moved down to being below the market, it would be like the poles reversing.

However, at least now we are looking at a far more conventional ratio alignment, even though the Y1 ratio bandwidth is 300 and the overall Y ratio bandwidth 450-points, at least it is now interrupted by the zone in the middle.

And now, just like the SPX, London now finds itself in bullish territory. Which must come as bit of relief after March, but we suspect it probably took the final couple of days last week for the market to actually realise this as it didn’t really have to do anything to achieve it.

The problem the FTSE now faces is that R1 is just 70-points ahead of it. Although, if it can cope with that, and it is only just above the R1 threshold, then there is another 150-points before the far more serious R3 kicks in.

And before you get too carried away, it is a sobering thought that from aforementioned R1 at 7550, the top boundary of the zone is 200-points due south.

Furthermore, as there are still three weeks to go in this expiry there is plenty of time for a lot to happen in.

First things first though, and a test of R1 and a look at how this market reacts to this amount of dynamic delta will tell us an awful lot about what to expect thereafter. What would be worse is for it to drift aimlessly around its current level, although we think that this is unlikely especially considering where the SPX is in relation to their ratios.

 

Range:            7350  to  7550       

Activity:          Average

Type:              On balance bullish

 

Nb. Our comment on 04/04/22

 

This is a very skittish zone this expiry, as it makes yet another move.

This time it goes back up to 7450-7550, which means the level we highlighted last week as important, 7550, took on a joint significance. Last week it was just where R1 started but, what with the zone move, it also became the upper boundary of the new zone.

Again, we should calculate this daily, but as we don’t, we believe it is a fair assumption that last week’s obsession with 7550 was for two different distinct reasons.

At the start of the week, it was all about the dynamic delta caused by R1 but, by the end, it was all about the fact it was now the upper boundary. Which was quite unusual as a move in the zone should be quite rare in this index, and yet here we are at the midpoint, and this is move three already.

And its not as if these are small moves, this latest being a jump of 200-points.

Can we say these moves are over, sadly no. Although, it may prove to be significant that there is no more Y1 ratio around.

However, there is still 500-points of Y2 ratio out there, which is still a ridiculously huge amount, so the potential for big moves is ever present.

So, the good news is that if it can break out of its zone, then R1 now doesn’t start until 7650.

However, the bad news, again if it breaks out of its zone, is that R1 below the zone doesn’t now start until 7150.

And with two weeks still to go in this expiry, then there is plenty of time remaining, and who knows, we may even get another zone move.

 

Range:            7450  to  7550       

Activity:          Moderate

Type:              Bearish

 

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March 28th, 2022 by Richard

Big zone move leaves the FTSE in bullish territory, but now with R1 dead ahead.

 

Nb. Our comment from the 03/21/22

For the record the FTSE spent the entire rollover Wednesday in its zone, so that was definitely job done. The Thursday and Friday are then just free to do what they want after that really.

Looking at the April expiry and we have to remind everyone that we just crunch the numbers and then try to interpret the results, so we have no control whatsoever as to what those numbers actually are.

We are pointing this out as it does look a very weird expiry.

First up is the fact the zone is 7550-7650 which, when you consider this market just a fortnight ago was battling it out with the ratio at 6950, is just a little odd.

It is basically as if the March expiry never happened.

Secondly, and probably as a direct result of the very high zone, there is a 400-point wide Y1 ratio bandwidth below it. That’s 5.4%, and this is just to start.

Obviously, the zone could easily move anywhere in this bandwidth, which might change the picture somewhat, but one thing that won’t change that quickly is that this is a huge expanse with absolutely minimal ratio in it.

Then when you add in the zone itself and the Y ratio above it, you are then staring at a possible trading range of 7150 all the way up to 7700, a staggering 550-points, or 7.4%. And this is a normal 4-week expiry, well not entirely normal as it expires on Thursday 14th due to the Bank Holiday.

Definitely going to be a fun trip this expiry, so best buckle-up tight.

 

Range:            7150  to  7550       

Activity:          Strong

Type:              On balance bearish

 

 

 

Nb. Our comment on 03/28/22

 

We did say the zone could move anywhere within that ridiculously wide Y ratio bandwidth, and it has.

We should, but we don’t calculate this daily, so we don’t know exactly when this happened but, guessing by the lack of impetus in the market from Wednesday onwards, we suspect it was then.

As, don’t forget, when it was at 7550-7650 it would have acted like a magnet but, once it moved down to being below the market, it would be like the poles reversing.

However, at least now we are looking at a far more conventional ratio alignment, even though the Y1 ratio bandwidth is 300 and the overall Y ratio bandwidth 450-points, at least it is now interrupted by the zone in the middle.

And now, just like the SPX, London now finds itself in bullish territory. Which must come as bit of relief after March, but we suspect it probably took the final couple of days last week for the market to actually realise this as it didn’t really have to do anything to achieve it.

The problem the FTSE now faces is that R1 is just 70-points ahead of it. Although, if it can cope with that, and it is only just above the R1 threshold, then there is another 150-points before the far more serious R3 kicks in.

And before you get too carried away, it is a sobering thought that from aforementioned R1 at 7550, the top boundary of the zone is 200-points due south.

Furthermore, as there are still three weeks to go in this expiry there is plenty of time for a lot to happen in.

First things first though, and a test of R1 and a look at how this market reacts to this amount of dynamic delta will tell us an awful lot about what to expect thereafter. What would be worse is for it to drift aimlessly around its current level, although we think that this is unlikely especially considering where the SPX is in relation to their ratios.

 

Range:            7350  to  7550       

Activity:          Average

Type:              On balance bullish

 

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March 21st, 2022 by Richard

Interesting zone placement in the FTSE April expiry, and with so much Y1 about this should make for a wild ride.

 

Nb. Our comment from the 03/17/22 (Not published)

Nb. Our comment on 03/21/22

 

For the record the FTSE spent the entire rollover Wednesday in its zone, so that was definitely job done. The Thursday and Friday are then just free to do what they want after that really.

Looking at the April expiry and we have to remind everyone that we just crunch the numbers and then try to interpret the results, so we have no control whatsoever as to what those numbers actually are.

We are pointing this out as it does look a very weird expiry.

First up is the fact the zone is 7550-7650 which, when you consider this market just a fortnight ago was battling it out with the ratio at 6950, is just a little odd.

It is basically as if the March expiry never happened.

Secondly, and probably as a direct result of the very high zone, there is a 400-point wide Y1 ratio bandwidth below it. That’s 5.4%, and this is just to start.

Obviously, the zone could easily move anywhere in this bandwidth, which might change the picture somewhat, but one thing that won’t change that quickly is that this is a huge expanse with absolutely minimal ratio in it.

Then when you add in the zone itself and the Y ratio above it, you are then staring at a possible trading range of 7150 all the way up to 7700, a staggering 550-points, or 7.4%. And this is a normal 4-week expiry, well not entirely normal as it expires on Thursday 14th due to the Bank Holiday.

Definitely going to be a fun trip this expiry, so best buckle-up tight.

 

Range:            7150  to  7550       

Activity:          Strong

Type:              On balance bearish

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March 14th, 2022 by Richard

7250 could be the level to watch for in the FTSE for the rollover and expiry this week.

 

Nb. Our comment from the 03/07/22

Well, we did say we could easily see a test of 7050 as, not only would that be in keeping with a triple, but under the present circumstances probably even more so.

The fact that this meant a tumble of just over 400-points, or 5.36%, meant that there was a huge amount of momentum inherent in the market, and obviously too much for the ratio at 7050 to cope with.

Although, having just said that, after the initial fall on Friday for most of the rest of the trading day the action did revolve around 7050, only capitulating in the final half hour.

And that is how the dynamic delta works, as the ratios just tell you where it is and how much of it to expect. What the ratios can’t tell you is the appetite of the market. So, at 7050 we know there will be a “DR” number of futures buying courtesy of the dynamic delta, what we don’t know is if this will be met by as many willing sellers.

However, generally we do get a feel for the market’s sensitivity, or an indication of how it will react to the levels of ratio, but under the current climate we can safely say that these are not normal times.

That said, the next ratio level coming up in the FTSE is B1 at 6950.

And as our levels are exponential, then this is a very significant number of futures buying generated by the dynamic delta. What we don’t know is whether this will be more than the market is willing to sell.

Under normal conditions we would have no hesitation in saying that this would be more than sufficient to turn the market but, with a war raging, who knows.

Finally, in the midst of all this excitement, it would be easy to miss the fact that the zone has slipped down to 7350-7450. This might not be so important in the next few days but, if any hint of normality returns, then it could become significant when we get closer to the rollover and expiry.

 

Range:            6950  to  7050       

Activity:          Poor

Type:              Bearish

 

 

Nb. Our comment on 03/14/22

What an absolutely epic battle with B1 the FTSE had.

And we must point out that on both Monday and Tuesday the actual open was 6890 and 6870 respectively, both being significantly below B1 at 6950, not the official 6987 and 6959.

Although on the Monday the market jumped 100-points straight up in just a few minutes such was the reaction to the dynamic delta unleased at the open.

Despite the deep incursion into B1, almost entirely down to huge gap downs at the open, the close on Monday was 6959.48 and on Tuesday 6964.11. Job done really.

Considering the gravity of the situation coupled with the obvious panic out there it was truly fascinating to watch how the market reacted to the dynamic delta and, naturally, we can’t not mention the SPX and their encounter with R2 at 4165.

Looking ahead, it is significant that the zone has fallen yet again and, it’s not beyond the possible that it might even return to where it started this expiry, at 7150-7250.

Although we have listed below the activity level as “moderate”, as this is a triple, where the numbers are just far far greater than an intermediary, this is actually very good. So, should this continue then there will no doubt be more changes.

It seems a very long time ago indeed when this index challenged R1 at 7550 north of its zone, the expiry high being on the very first day (21st Feb) at 7571.07 and again on the following Wednesday with the intraday high of 7549.98.

Therefore, considering how far this market has come back, and the nomadic nature of the zone, we think it will do well to hold the rollover and expiry in the Y ratio bandwidth. Although, we of course would like to see it end in its zone, but we have to be practical to a degree.

As 7250 is the current bottom boundary of its zone, which if it does return to its starting point, this would make 7250 the upper boundary, so in both scenarios we see this as a critical level this week.

 

Range:            7150  to  7250       

Activity:          Moderate

Type:              Bullish

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March 7th, 2022 by Richard

Huge Ratio level coming up in the FTSE.

 

Nb. Our comment from the 02/28/22

Apologies for not publishing last week, especially as we appreciate it might have been rather useful to know the ratio levels. In particular, that the zone at the start of this expiry was at 7200. Coincidentally, 7200 was the low and close on Thursday.

However, before this, the pertinent ratio level was R1 at 7550.

On Monday 21st the intraday high was 7571.07 before the market gave up just under 100-points.

Then on Wednesday 23rd it revisited it with the intraday high of 7549.98, before giving up 50-points.

The fact that the zone has moved up to its current position was always on the cards but, as we have mentioned previously, because triple witching expiries are so much bigger than the intermediaries then it’s like turning an oil tanker, very slow.

The problem the FTSE faces now, is that by leaving the move so late, it has left a vast swathe of the minimal Y ratio around, but especially below the zone.

And if this wasn’t bad enough, as triple expiries progress, they tend to get far less sensitive than intermediaries, so rather than reacting to R1 it would be entirely in keeping if March went on to test R3 or even higher levels.

And March still has three weeks to go, so we could easily see a range of 7050 all the way up to 7650, although it hasn’t done badly already, going from 7550 down to 7200 and back up again.

Probably be too big an ask to see it see this week out in its zone, but you never know.

 

Range:            7450  to  7550       

Activity:          Poor

Type:              Bearish

 

 

 

Nb. Our comment on 03/07/22

 

Well, we did say we could easily see a test of 7050 as, not only would that be in keeping with a triple, but under the present circumstances probably even more so.

The fact that this meant a tumble of just over 400-points, or 5.36%, meant that there was a huge amount of momentum inherent in the market, and obviously too much for the ratio at 7050 to cope with.

Although, having just said that, after the initial fall on Friday for most of the rest of the trading day the action did revolve around 7050, only capitulating in the final half hour.

And that is how the dynamic delta works, as the ratios just tell you where it is and how much of it to expect. What the ratios can’t tell you is the appetite of the market. So, at 7050 we know there will be a “DR” number of futures buying courtesy of the dynamic delta, what we don’t know is if this will be met by as many willing sellers.

However, generally we do get a feel for the market’s sensitivity, or an indication of how it will react to the levels of ratio, but under the current climate we can safely say that these are not normal times.

That said, the next ratio level coming up in the FTSE is B1 at 6950.

And as our levels are exponential, then this is a very significant number of futures buying generated by the dynamic delta. What we don’t know is whether this will be more than the market is willing to sell.

Under normal conditions we would have no hesitation in saying that this would be more than sufficient to turn the market but, with a war raging, who knows.

Finally, in the midst of all this excitement, it would be easy to miss the fact that the zone has slipped down to 7350-7450. This might not be so important in the next few days but, if any hint of normality returns, then it could become significant when we get closer to the rollover and expiry.

 

Range:            6950  to  7050       

Activity:          Poor

Type:              Bearish

 

The faction account of the Big Bang, The Great Storm and the market crash of 1987, available in eBook and paperback here, a must read if you don’t believe in history repeating itself.

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February 28th, 2022 by Richard

The FTSE March expiry ratios need to settle.

 

Nb. Our comment from the 02/21/22 (Not published)

Nb. Our comment on 02/28/22

 

Apologies for not publishing last week, especially as we appreciate it might have been rather useful to know the ratio levels. In particular, that the zone at the start of this expiry was at 7200. Coincidentally, 7200 was the low and close on Thursday.

However, before this, the pertinent ratio level was R1 at 7550.

On Monday 21st the intraday high was 7571.07 before the market gave up just under 100-points.

Then on Wednesday 23rd it revisited it with the intraday high of 7549.98, before giving up 50-points.

The fact that the zone has moved up to its current position was always on the cards but, as we have mentioned previously, because triple witching expiries are so much bigger than the intermediaries then it’s like turning an oil tanker, very slow.

The problem the FTSE faces now, is that by leaving the move so late, it has left a vast swathe of the minimal Y ratio around, but especially below the zone.

And if this wasn’t bad enough, as triple expiries progress, they tend to get far less sensitive than intermediaries, so rather than reacting to R1 it would be entirely in keeping if March went on to test R3 or even higher levels.

And March still has three weeks to go, so we could easily see a range of 7050 all the way up to 7650, although it hasn’t done badly already, going from 7550 down to 7200 and back up again.

Probably be too big an ask to see it see this week out in its zone, but you never know.

 

Range:            7450  to  7550       

Activity:          Poor

Type:              Bearish

 

Available to buy now

The faction account of the Big Bang, The Great Storm and the market crash of 1987, available in eBook and paperback here, a must read if you don’t believe in history repeating itself.

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