Two Charts That Help The Bullish Case

Things have been ugly out there the past few weeks.  If you’ve been following me lately, I’ve been more cautious myself.  That is probably a contrarian buy signal right there.

Getting to it, these are two charts that say maybe, just maybe, a tradeable bounce is coming soon.

Going back the past 40 years, the SPX has bottomed on exactly April 14.  That is today if you lost your calendar.  Now, most years April is also higher at this point though.  Still, things usually bottom now and rally till the end of the month.

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What about fear?  Well, we all know you want to buy when others are fearful.  Is there enough fear out there to mark a major bottom?  Honestly, I don’t think we’re there yet, but could be close with another move lower.  

None the less, check out this proprietary front month gamma weighted put/call ratio we track.  This ratio looks at just the three big ETFs:  SPY, QQQ, and IWM.  

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We’ve seen a huge spike in puts in front month ETFs, the most since mid-2012!  If you think investors get worried and load up on ETF puts when they get scared, you like seeing this.  Plus, previous spikes have nailed some major bottoms.  Could it be right again?

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