The SPDR S&P 500 (ARCA:SPY) put-call ratio rose to 2.39 today. That is very high heading into the Thursday before opex week and well above its 20 dma.
The long-term average ratio by opex Friday is 1.50. By Thursday of triple witching weeks, the ratio is usually at or through its bottom Bollinger Band. It tends to get there in the context of a sharp rally.
So this is bullish for prices, but it’s still too early to say that we’ll see the effect immediately tomorrow. The ratio could still get more extreme before we see the effect.
SPY put volume fell today by 25%. But demoralized bulls reduced SPY call volume by 35%.
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