I've yet to hear anyone really know and explain the reasoning
for such high put/call numbers. So far some have suggested:
ODTE trading (which has been going on pretty much all year),
Arbitrage (not sure, how that works), people trading options is
increasing (this would have been much worse during the pandemic
imo) and my guess is that maybe traders are spinning off long term
options for tax losses and repositioning with puts?
All I know is that the indicator kept me from taking a short
position on this last move and was wrong. I'm not sure if I
know how to use the data anymore or if it's helpful due to the wild
gyrations.
Posted by timebandit on 22nd of Dec 2022 at 09:09 am
I was thinking the same, cozz101. I don't understand how to use
the data anymore. I bet short without checking the p/c ratio, and
might not have taken the position if I had checked it
first.
Smart move, congrats! I have to wonder if the numbers are
predicting something for the next quarter, which is a little
further out than a quick swing trade.
Here are a couple articles I found on the phenomenon. This is
historic and apparently these readings haven't been this high
or volatile for at least 5 years.
I've yet to hear anyone
This $CPCE chart is insane. I would say it's bullish, ...
Posted by cozz101 on 22nd of Dec 2022 at 08:48 am
I've yet to hear anyone really know and explain the reasoning for such high put/call numbers. So far some have suggested: ODTE trading (which has been going on pretty much all year), Arbitrage (not sure, how that works), people trading options is increasing (this would have been much worse during the pandemic imo) and my guess is that maybe traders are spinning off long term options for tax losses and repositioning with puts?
All I know is that the indicator kept me from taking a short position on this last move and was wrong. I'm not sure if I know how to use the data anymore or if it's helpful due to the wild gyrations.
I was thinking the same,
Posted by timebandit on 22nd of Dec 2022 at 09:09 am
I was thinking the same, cozz101. I don't understand how to use the data anymore. I bet short without checking the p/c ratio, and might not have taken the position if I had checked it first.
Smart move, congrats! I have
Posted by cozz101 on 22nd of Dec 2022 at 09:13 am
Smart move, congrats! I have to wonder if the numbers are predicting something for the next quarter, which is a little further out than a quick swing trade.
Here are a couple articles
Posted by cozz101 on 22nd of Dec 2022 at 09:01 am
Here are a couple articles I found on the phenomenon. This is historic and apparently these readings haven't been this high or volatile for at least 5 years.
https://www.forbes.com/sites/georgecalhoun/2022/12/05/the-putcall-ratio-of-market-sentiment-went-crazy-in-november-what-can-it-mean/?sh=330d8b3a3e2a
https://seekingalpha.com/article/4563739-equity-putcall-ratio-in-uncharted-territory
forbes.com
The Put/Call Ratio Of Market Sentiment Went Crazy In November: What Can It Mean?
The ratio of Put options (negative sentiment) to Call options (positive sentiment) is a powerful and accurate market indicator. It correctly predicted the latest 20% rally in the market since Sept 30. But last month the PCR went berserk. Does it signal some important change in the market regime?
Thanks for the articles...
Posted by timebandit on 22nd of Dec 2022 at 09:12 am
Thanks for the articles...