NV, on April 4th, I wrote, "I am fully loaded, let the rally come", and it was not the the equity P/C ratio by itself that led me to that call. As a matter of fact leading to April fourth we had P/C of .58, .69 and .83, not particularly high ratios, particularly if you remember that 400 Naz points above the April 4th bottom in the week of March 12th, we had readings all above .7 with two readings above .9, yet we got a 20% hair cut within three weeks. On April 4th we also had other excessive reading like very negative tic and high trin (much higher than today) and particularly, and more importantly, we had peaking VXN and VXI which we do not have at all today. I would not count on the spike in the P/C ratio to .87 today, particularly that this week is expiry, when you will get strange reading in options trading, and furthermore, on Wed. you had an equity P/C ratio under .5 quite bearish by itself.
Zeev |
