CPC and CPCE Put/Call Ratios Daily Charts; Significant Stock Market Top is At Hand

Moral hazard has arrived. The Federal Reserve, and other global central banks, have been printing money for over 11 years and traders and investors are now officially Pavlov's dog. Everyone always expects the Fed to pump the stock market higher forever so folks want to buy every dip with enthusiasm. The fearlessness is off the charts for the last four months. This behavior is unprecedented.

The low CPC and CPCE put/call ratios signal a significant stock market top occurring. If stocks rally after Powell, the charts above tell you that you should be selling the rips not buying the dips. A nice tradeable bottom does not occur until the prices move above the green lines. You want to buy when people are running for their lives screaming bloody murder. Simply prepare a long list but wait for the panic and fear to arrive before you begin nibbling. 

Everybody and his brother are committed to the stock market and do not believe it will ever pull back in any meaningful way just like when American economist Irving Fisher said the stock market was at a permanently-high plateau, in 1929. 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.

Note Added Thursday Morning, 9/17/20, at 2:36 AM EST: Fed Chairman Powell promises ZIRP through 2023. The central bankers are sick. Powell says bond purchases will remain at current levels. Stocks pop on the dovishness but then roll over into the closing bell. The SPX HOD is 3428.92 and the 20-day MA is 3428.74. Price comes up for a test of this key resistance and is spanked back down. The SPX finishes Wednesday down 16 points, -0.5%, to 3385. S&P futures have been deteriorating the last couple hours from -33 down to -65 currently about a -2% drop for the S&P 500 cash index if the futures remain negative. The Federal Reserve's grand 11 plus year Keynesian financial experiment is beginning to unravel. Treasury yields tick a bit higher since some bond traders likely expected more bond purchases. Higher rates hurt utilities. If the dollar rises, especially in a short squeeze, as described here over the last month with the dollar charts bottoming, commodities will be whacked.