Nb. Our comment from the 06/22/2022
Obviously, there were some huge changes in the ratios in the last few days of the June expiry but, sadly we were not around to record them, so who knows.
The one thing for certain though, is that it must have gotten seriously out of control, as even if June’s zone ended up where July’s has started, it was still a huge miss on Friday as the EDSP was 7108.24.
Not only that, when we shut up shop, B1 was at 7150. Of course, it would have fallen, and considerably so, but there is no escaping that at the end the market would have been amid a considerable amount of ratio. So, very very expensive for someone.
Which brings us round to this new expiry, the July trip.
And, straight from the very start, the FTSE was imbedded deep into some high ratios.
In a triple we always say it gets very heated, and naturally seeks out the higher ratios to compensate for the huge increase in overall activity. However, this is an intermediary, so it should revert back to being sensitive to the low to mid-range R ratios.
And yet, here it was, starting life just a smidgen north of DR. Quite the rude awakening.
Also, we are not overly surprised with the battle that took place all day yesterday at 7150, as this is a very significant level.
One look at the above table tells you that.
In fact, the ratios are so lopsided this expiry, it is now dangerous being short. Foolish not to have at least extremely tight stops.
7150 will decide whether or not this market digs itself out of a ratio mess, and can head back up to its zone, or not. Big call.
Range: 6850 to 7150 or 7150 to 7350
Type: On balance only just bearish
Nb. Our comment on 07/04/22
“Big call” indeed, as the FTSE had to dig itself out of the R3 ratio hole it had dug itself into first.
By which we mean the open on the very day we last published, the 22nd June, when the market opened below 7150 and really looked in a very sorry state.
Sadly, we just don’t know when 7150 changed from R3 to R2, but whenever it was, this was always the crucial level.
Still is, as having gone all the way back up to its zone’s bottom boundary, at 7350, here we are back at R2 again.
That failure, on the 28th and 29th, when the intraday highs were 7362.37 and 7345.45 respectively, was very damaging for the bulls. Therefore, the fact that the market closes on Thursday and Friday last week were all about 7150 again, should have come as no surprise.
The fact that the Y1 ratio bandwidth below the zone is 200-points wide, also accounts for the big moves, essentially from 7350 to 7150.
So, although it may have appeared exciting at the time, in essence this market has gone absolutely nowhere in two weeks.
Definitely more troubling for the bulls, as not breaking back up into its zone at 7350 shows a worrying lack of commitment from them. Whereas the bears, have been happy to make deep intraday inroads into the R2 ratio bandwidth. However, both are now on strike three from last week alone.
As we are now just at the half way stage of this expiry, there is ample time left. So, although the market hasn’t really moved in the last two weeks, it does now know where the pertinent levels are. Therefore, game on, we think.
Range: 7050 to 7150 or 7150 to 7350
Type: On balance only just bullish