Put Call Ratio: How to Use It for Market Sentiment Analysis - Vidéos industrielles CGM-LASER

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Questions fréquentes

Frequently Asked Questions About the Put Call Ratio

What is the put call ratio?

The put call ratio is a popular sentiment indicator that compares the trading volume of put options to call options. It helps traders gauge whether the market is overly bullish or bearish.

How can the put call ratio predict market moves?

A high put call ratio suggests excessive bearishness, which can indicate a potential market bottom. Conversely, a low ratio may signal excessive bullishness and a possible market top.

Why is the put call ratio considered a contrarian indicator?

The ratio works as a contrarian indicator because extreme readings often occur at market turning points. When most traders are bearish (high put volume), it may signal a buying opportunity, and vice versa.