12 replies to this topic

[qqqqtrdr]

One thing you are missing is that this is not a high volatility top like 2000.... It is likely that this top will come on lower P/C ratio. In fact it is likely that that peak of 1.75 in late September was the top for this OEX P/C cycle.

As you may have noticed, 10 DMA of OEX P/C hit 2+ at the beginning of 2000 which was 2 months early.

So that September reading of 1.75 could very well be THE top and this first lower impulse OEX P/C currently forming may trigger the first trust of this coming bear market.

It is generally a matters of days not weeks when the 10 DMA is high on OEX P/C. The question really is do you trade on this signal alone.... Regardless it is a bearish signal when the 10 DMA is over 1.60 until it goes under 1.40. You should not be long during this time. At 1.40 it goes back to Neutral. I'm doubling down going 2X short on this signal

[Caduceus]

The OEX P/C ratio 5MA is over 2 right now. The only other times when it has reached this level was very late in December 2000 and very late in August in 2000. Also, the 21MA is at levels it has not seen since late August of 2000. I would not be suprised to see a "one day wonder" here, but I will get nervous if the $NDX gets back to it's highs. Here is another chart I am watching... [attachment=5265:attachment]

[OEXCHAOS]

The options data are very weird. A number of nominals, like the QQQQ at 11.08, are high, but not all of them. Many others are neutral and a few $-weighteds are even showing a bit to much Bullishness. Odd stuff. I agree with D&Co, however. The high 10-day OEX is a warning sign. It was dead wrong way back when, but it was a different sentiment situation then (and I said so). If we had more amateur Bulls, I'd be getting REALLY nervous. As it is, I just think that there's something up near term. Somebody knows something and we may have a one or two day shot down. Don't lean too much however! Mark