Nb. Our comment from the 02/18/22 (Not published)
Nb. Our comment for 02/23/22
The February settlement price was 4383.70, so a little way below the zone (which finished at 4445-4455) but easily within the Y1 ratio, so as good as it was going to get.
Of course, US markets were closed on Monday, so this is only the second day of the first triple witching expiry of 2022, an expiry that was always destined to start life below its zone.
Which should have come as no surprise, as this market has been in bear territory for some time, on top of which the zone had started falling, having threatened to for so long.
So, with everything else going on, the overriding question was where, or if, this market would get some support.
As one can see in the tables above Y2 was 4390, last Friday as well as Tuesday, but has fallen today to 4345. Considering the market closed on Friday at 4348.87 this was a moot point anyway.
The real level to watch would have been R1, which has remained the same since last Friday. So, yesterdays intraday low of 4267.11 gives us a very good insight as to what level of sensitivity exits in this expiry. And, although it did overshoot by twenty odd points, this is not disappointing because firstly, yesterday was the first day so the market naturally takes a bit of time to adjust, and secondly, it was always going to react to the geopolitical news and be playing catch-up with Europe.
The telling point was the close, back above R1.
Then, the fact R1 has remained at this level today is also reassuring.
It is by no means out of the fire yet, but as an early indication that it will respond to the dynamic delta is a good sign, as irrational fear (or greed) is never good.
Now, we just have to see how the ratio levels evolve, and as they are already dropping below the zone this is a bearish sign but, early days.
Range: 4295 to 4495