Monday, April 20, 2015

CPC Put/Call Ratio Daily Chart Signals Market Top

The roller coaster ride continues. One day up one day down; is tomorrow the bear's turn again? The TRIN chart posted on the weekend wanted a quickie relief rally due to the 4.00 number which occurred today. For the CPC above, you typically want to see a 1.20 or higher to know that you have a firm stock market bottom to go long. Today's rally occurs from a 1.13 number not exactly a ringing endorsement that a proper bottom was placed. Further, instead of the CPC dropping just a smidge say to the 0.95-1.10 area, it plummets directly back to pure complacency territory at 0.79.

Who can blame traders for remaining non-stop complacent buying stocks without any worry or fear? The central bankers are the market. The PBOC (China's central bank) goosed the US and European indexes today with the triple R cut to their banks. The global central bankers will send stocks higher forever to make the wealthy, that own stocks, richer, so why worry? It's like having a rich uncle that always bails you out. There is never any reason to change your behavior. Uncle Sam will be there with the dough to beat the rap.

The low CPC 0.79 identifies complacency and another near-term market top. The stock market may be getting shaky from all the whipsaw behavior. Watch your wallet. Markets should place another top any day forward and selloff until the CPC moves above 1.20. 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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