st.paddy's thursday, page-28

Today ended up red, but it felt like a win for the bulls. For the first time in a long time we have been outperforming US and Europe. No surprises that this happens with a falling AUD.

So worth havin a look at the put call ratios to see how far sentiment has stretched.

XJO with PCR;



This one doesn't include todays data. We can see it is at an extreme a fair way beyond the levels seen in May last year. I would suggest todays action would see the PCR hook over, or at least flatten out. As the PCR peaks coincide with price bottoms, it suggests we are in the vacinity of an important low.

SPX with Equity Only PCR;



Curiously, the SPX is at less of an extreme than our market. It could be interpreted as being at an extreme, but could easily go further. This difference fits with the US markets making lower lows overnight, but we somewhat diverged to make a higher low today.
My conclusion is to believe in the bum - buy the freakin dips.