Comment on Open Interest, MaxPain & Put Call Ratio(PCR)
commented on
05 Dec 2017, 02:41 PM
Hi Team,
Your this point seems to be incorrect. Since PCR is below 1, then market should go up.
“If PCR is below 1, it would mean that more calls are being traded and since more calls are being traded by the retail traders (option buyers) this could mean that the markets might do the opposite which is go down. Lower than 1 the PCR is, higher the chances of the market coming down. Since you know that historically PCR has been in the range of 0.7 to 1.3, at 0.7 PCR the chances of the market coming down will be the highest.”