I analyze macroeconomic issues from a fundamental perspective, and I analyze market behavior from a technical perspective. Original macroeconomic analysis can be found here and both macro analysis and commentary can be found on my Caps blog. If you like or appreciate my analysis, please add yourself to my Following List

Tuesday, January 25, 2011


Here is a closeup version of the longer term sentiment chart that I watch (see Sentiment Chart). There are some interesting behaviors at play:

1) Move From July 2009 - April 2010 had a clearly down channeling (bullish option sentiment) trend

2) Apr-June down move in the stock market had a clear up move in the CPCE (bearish trend) and it slightly preceeded the actual drop

3) Move From June 2010 to now has had a clearly channeling down move in the CPCE (bullish sentiment)

4) Highest Put Call Ratio at the close since June. Do we have an option sentiment change right before another correction?

I think these points are certainly worth pondering

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