PCC & QQQ: PUT TO CALL RATIO / MARKET BOTTOM NEARING???DESCRIPTION: In the chart above I have included an overlapping analysis of PCC which is a PUT TO CALL RATIO INDICATOR & QQQ a LEADING INDEX in the OVERALL MARKET.
POINTS:
1. A PUT TO CALL RATIO LEVEL OF 2:1 HAS ALWAYS BEEN INDICATIVE THAT A MARKET BOTTOM IS NEARING OR IN.
2. MACD is has officially shown a complete flip in buying to selling pressure by touching +0.1 and falling closer to -0.05.
3. RSI is showing a distinct decline seen in past market bottoms.
IMO: With an overabundance of overall bearish market sentiment and spikes being seen in PUT TO CALL RATIO INDICATORS FOR EQUITIES & INDICES it should be safe to bet that market bottoms occur when the majority of retail investors are buying PUTS as MARKET MAKERS would not allow their CONTRACTS to EXPIRE IN THE MONEY.
SCENARIO: Continuous spikes to 2 POINTS for PCC and above is most certainly a sign that a MARKET BOTTOM is in the making already.
FULL CHART LINK: www.tradingview.com
USI:PCC
NASDAQ:QQQ
PCC
$VIX $PCC $DXY - All telling the same storyThe Macromarket is telling the same story overlapping on the same chart. More puts to calls, higher DXY, and Higher VIX. Likely a near-term top given the number of amateur investors seeing this same reality, but the trend will likely continue until something big breaks and the system bottoms and a new market cycle starts.
PCC - Options Volumes 71% DeclineLiquidity within Leveraged products was used to provide
a bid for the Underlying on Gamma/Delta.
With the overall decline in participation, we are seeing
Micro Range Squeezes develop when it is "Time".
Friday's trade was a run to Square, and with the Retail
Options players levered up in 420 Spy Calls... there was no
chance they would be paid.
The PCC remains useful although in a tighter range from .86
to 1.12.
Looking over the June 17s - "an Entity is looking for a deep correction of 20%+"
maximum-pain.com
PCC - Tom Lee JinxNever underestimate the lunacy of former JPM Alumni
Tom Lee.
The Cathy Wood of C N B C - Tom simply needs to STFU.
In January, Tom was concerned about the Markets after
Mid-Year...
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Market Liquidity is evaporating.
Volatility is expanding.
The Algos have been very careful to press the Sellers on
spikes in the Put/Call Ratio for the CBOE.
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Real Estate Ballon
Stock Market Bubble
Bond Market Beyond
So, VX intraday is used to keep everyone offsides and out
of the trades with extreme - wide-ranging swings.
Use the PCC to your advantage, it has worked quite well.
The range has been roughly 105 to 135 recently.
Trade safe and good luck.
Put / Call Ratio CBOEPCC can become more extreme, will it...
The one to watch for a Countertrend.
Many Sectors have broken or are @ 200 EMMs.
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Many Weekly candles shower an acceleration of
Momentum last week.
Eventually, the squeeze arrives... from where...
TBD.
Potential NQ SupportNQ at potential support. Looks like NDX will open lower Thursday . . . and it was somewhat expected that futures would gravitate lower considering VXN closed in no-mans-land today. . . anticipating a tap of VXN at the 36 level resistance and then NDX to the upside. PCC is within normal levels indicating to me that there is little panic and/or bearish sentiment has low conviction.
NDX Finding SupportNDX looks like it could find support at ~11,000 for the following reasons.
1) Potential Trend Line Forming; Break toward the top
2) I have the 2 Stdev Bollinger bands plotted: Price action is at the lower limit at this moment and could present buying pressure from the many who use this metric for entry points.
3) Fib levels show a retracement level at about 11,0000
4) VXN looks like it is hitting resistance at 43 and we are lower today than the values we saw on 10/28. Next resistance is ~46, and then ~60, so some risk there if volatility breaks out, but currently looks like the 43 level is holding.
5) PCC ratio is lower than the 10/28 value as of this moment, providing a little bit of comfort.
With this in mind, I believe this is a decent entry point for those willing to take the risk. If you have the ability to trade options, maybe consider selling some delta 30 covered calls to hedge your trade.
Update on Nasdaq Regression Trends, Support and ResistanceUpdating these charts for this week as the market character continues to change. If the NASDAQ is going to return to the regression mid-point lines for 1yr, 2yr, 5yr and 35yr, there is still significant drawdown to happen in the next couple months.
Over the past two weeks, the index has gone up and down, but has consistently followed bearish trend lines, even on up days.
Investors are rotating through sectors looking for safe havens that will hold up well. Real Estate was last week, Energy is this week.
Unless something changes (economic stimulus, other news), I'm still expecting a 0.5-3% drop this week (especially if China-relations further deteriorate from the TikTok stall) and 13-15% into mid-October.
Lots of others expecting these drops as well. Look at Call/Put Ratios and SQQQ Volume continues to be high.
