Friday, December 12, 2014

CPC Put/Call Ratio Daily Chart

Despite the strong selling on Wednesday and then the failed recovery for stocks in the Thursday session, traders remain complacent and relaxed about the selling. Red circles show complacency that creates a market top while green circles show worry, fear and panic that creates a market bottom. Pundits parade across television and computer screens daily touting a never-ending upside direction for stocks. That attitude is reflected in the CPC and CPCE which shows sudued readings and no indication of fear and panic. Thus, the selling would be expected to continue until that tinge of panic and fear develops. This chart does not include today so this evening check to see what the prints are for CPC and CPCE.

If the CPC prints at 1.20 and higher than a near-term bottom is at hand for stocks and some nibbling on short-term long trades to play a quickie bounce would be in order. If the CPC stays under 1.20 you do not want to be buying any stock on the long side. The CPC should print in the green circle in the right margin which will identify a tradeable short term bottom for stocks. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

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