| | | Thinking, Bob, there might be a decent short term trading system hidden in this. Looks like every time Put /Call ratio on the daily gets close to (or breaks) 0.85 on the upside, or 0.6 on the downside, the ratio is in an area where it is highly likely to reverse. Slightly tighter than usual BB (20, 1.5) seems to help.
Near high P/C points - look to short puts.
Near low P/C points - look to short calls (or sell covered calls, or buy puts).
Buying calls after market declines doesn't pay, IMO, because they tend to be expensive. Buying (cheap) puts during extreme lows in P/C, otoh, may work. Using spreads rather than naked options would eat up some of the profits, but it's safer and would save a lot of margin.
(This is NOT formally tested - because I don't know how to do that... use at your own discretion... g/ng)
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