CBOE Equity Put/Call Ratio Hits New Low for 2010
By
Rennie on Wednesday, March 10th, 2010 at 2:25 am
Our version of Standard & Poors’ Oscillator closed over 7.0 on Tuesday. While this is traditionally ‘overbought territory, more reliable signals are triggered in the direction of the primary trend. When the S&P trades higher in the week following a 7+ Oscillator, the market has a good track record of continuing to push higher over the next two weeks. A close above today’s settlement at SPX 1140 next Tuesday would trigger this intermediate-term buy signal.
The CBOE equity put/call ratio closed at a low .43 Tuesday, nearly the third consecutive lower close (Monday’s close of .5248 was just slightly ahead of Friday’s .5239). Recall that three straight lower closes for the put/call ratio has short-term bullish implications (see this column from last week). I examined Tuesday’s low equity put/call ratio from a number of different angles (below .50, 25%+ below 10-day average, lowest reading in two months, etc…) but found no significant edge.
CBOE Equity Put/Call Ratio Hits New Low for 2010
By Rennie on Wednesday, March 10th, 2010 at 2:25 amOur version of Standard & Poors’ Oscillator closed over 7.0 on Tuesday. While this is traditionally ‘overbought territory, more reliable signals are triggered in the direction of the primary trend. When the S&P trades higher in the week following a 7+ Oscillator, the market has a good track record of continuing to push higher over the next two weeks. A close above today’s settlement at SPX 1140 next Tuesday would trigger this intermediate-term buy signal.
The CBOE equity put/call ratio closed at a low .43 Tuesday, nearly the third consecutive lower close (Monday’s close of .5248 was just slightly ahead of Friday’s .5239). Recall that three straight lower closes for the put/call ratio has short-term bullish implications (see this column from last week). I examined Tuesday’s low equity put/call ratio from a number of different angles (below .50, 25%+ below 10-day average, lowest reading in two months, etc…) but found no significant edge.