Wednesday, September 20, 2006

The Put/Call ratio is high at 1.4. This sign of extreme fear is bullish for stocks.

2 comments:

Anonymous said...

Deb,

Isn't it unusual to see this level of fear after a run UP in stocks, surely this would normally occur after a serious correction? There seem to be alot of anomolies at the moment.

Enjoying your commentary,

Deborah said...

Dear John,
You are right. I assume that the inverted curve, recent hedge fund failure (Amaranth), and coup in Thailand are causing the spike in the Put/Call ratio. Many traders fear a re-run of the 1997 currency crisis that started in SE Asia.
Best,
Deb