The CBOE Put/Call Ratio, much like yesterday's highlighted measure, suggests the market could be poised for a major setback...
The present moment's similarity to that leading up to the "flash crash" of May 2010 is both noteworthy, as well as fitting a consensus sentiment placing the threat of a crash nowhere on the radar. Evidence presented by other technical measures indicating underlying weakness consistently increasing over the past two years finds the CBOE Put/Call Ratio suggesting we might be just minutes until Spain implodes.
Sensational claims that, the ECB's liquidity flood brings Europe's problems "under control" only the more reveal the threat of a crash fittingly is being ignored — a risk with fundamental basis in fact, given extraordinary actions being taken by lenders of last resort on both sides of the Atlantic. Appreciating that, hyperinflationary happiness simply cannot stop is understanding the trans-Atlantic banking system's complete dysfunction. Yet that no one perceives imminent calamity exposes naked greed with very little basis in reality to reasonably expect its satisfaction. Thus, an hour made for experiencing grave disappointment rather rightly finds a consensus sentiment apparently quite oblivious, as indeed, it rightly should be.
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© The Risk Averse Alert — Advocating a patient, disciplined approach to stock market investing. Overriding objective is limiting financial risk. Minimizing investment capital loss is a priority.
Analysis centers on the stock market's path of least resistance. Long-term, this drives a simple strategy for safely investing a 401(k) for maximum profit. Intermediate-term, investing with stock index tracking-ETFs (both their long and short varieties) is advanced. Short-term, stock index options occasionally offer extraordinary profit opportunities when the stock market is moving along its projected path.
Nothing is set in stone. Nor is the stock market's path of least resistance always known. More often than not, there are no stock index option positions recommended.
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