I don't really have any comment of the first half hourly sudden jump in the equity P/C ratio. This ratio is one of many indicators, and by itself, not a very good indicator except at major extreme. Look at:
stockcharts.com[w,a]daclyymy[pb10!b21][vc60][iUb5!La12,26,9]
There is some correlation with peaks in the moving average (and you can get some refinement by studying cross over between short term and medium term MA) and local bottoms in the market, as well as with bottoms in the MA and peak in stocks prices. But you can easily be fooled (I was, in mid March when that average was peaking, but the bottom in the Naz did not come until early April). Yet, you can see that all the major "turnips Bottom calls this year (late December early January, late March early April, and finally late September, correspond to good buying opportunities. Similarly, all the turnips calls for "bear suits" (February Massacre, Late May top) correspond to good selling opportunities. Look at that chart, and tell me if the current pattern resembles more the pattern in late March or late September, or the pattern in late January and late May. What do you see? Of course, by the time the turnips make that call, these numbers are not yet there, so I only use these as confirmatory (I "called" the February Massacre very early after the first fed move, and had that "battle cry, br out no later than 2:15 January 31st, long before we reached that MA bottom late in January earl February) rather than "predictive" tools.
Zeev |
