Category: Expert Columns

Volume PCR (Put Call Ratio) is a technical indicator that can be used to gauge short-term market sentiment. A higher Volume PCR indicates that more put options are being traded than call options, which suggests that bearish sentiment is increasing. Volume PCR is negatively correlated with the underlying, meaning that it often rises during the fall in the underlying and often falls during the rise in the underlying. This means that Volume PCR can help us get the first sight of a turnaround in a bull market. Traders can use Volume PCR to trade more confidently in a bull market by looking for Volume PCR to be at a recent bottom.

Global financial markets came under pressure last week as investors turned their attention to a number of key issues, including China's real estate troubles, the potential for more Fed rate hikes, and differing opinions on Europe's rate outlook. The US dollar index surged to a six-month high, while US treasury yields rose. Global equity markets fell, and oil prices rose. The upcoming week will bring a focus on US inflation figures, retail sales data, the ECB monetary policy meeting and a range of Chinese economic data releases. Investors should monitor these factors and adjust their investment strategies accordingly.

Gamma explosion is a phenomenon that occurs when the gamma of an option increases rapidly, typically in the days leading up to expiration. This can cause the option's price to move very quickly in response to small changes in the underlying asset's price. Gamma explosion can be used to increase profits or reduce risk, but it can also be dangerous if not understood.