![bearish](https://joehentges.net/wp-content/uploads/2019/01/bearish-1030x567.jpg)
Denial turns to Fear…Put/Call Extremes
December 21, 2022 showed an Equity Put/Call ratio of 2.04. That means 204 puts traded for every 100 calls. My data extends to November 2006. This is the highest one day reading in 16 years. In addition there have been three other readings during December, higher than anything seen since the previous high of 1.34 on March 17, 2008.
The 10 day average readings are now above 1.00…unprecedented. The 10 day reading hit 1.07 on December 22, a new high for my data. The last time we got any 10 day readings in the 90s was March 2020 and before that, several times in 2008-2009.
2008-2009 was Wave C of Primary Wave 4 of Cycle Wave V. C waves are usually very strong and it was the end of an eight year, major corrective pattern. See tables below.
Numbers in the first column are actual readings. The second column are 10 day averages. The dashed line boxes in the chart show where these extreme readings took place.
![Mar 2008](https://joehentges.net/wp-content/uploads/2022/12/Mar-2008.png)
![Sept 2008](https://joehentges.net/wp-content/uploads/2022/12/Sept-2008.png)
![Oct 2008](https://joehentges.net/wp-content/uploads/2022/12/Oct-2008.png)
![Nov 2008](https://joehentges.net/wp-content/uploads/2022/12/Nov-2008.png)
![Jan 2009](https://joehentges.net/wp-content/uploads/2022/12/Jan-2009-1.png)
![2007-2009](https://joehentges.net/wp-content/uploads/2022/12/2007-2009.png)
The bullish sentiment that took hold in Primary Wave 5 of Cycle Wave V (Mar 2009 – Jan 2022) was extraordinary and created a huge bubble. That bullishness has been very hard to extinguish in 2022.
But we have now had a strong bear move lower. Until recently, bearish sentiment, as shown by put/call ratios had not shown up. Investors/traders have been in denial. But that is changing. It’s taken 11 months of this bear move to get any extreme readings. In 2008 it only took 5 months from the high to get the first extreme readings in March 20008.
![Dec 23](https://joehentges.net/wp-content/uploads/2022/12/Dec-23.png)
December 2022
![SPX_2022](https://joehentges.net/wp-content/uploads/2022/12/SPX_2022.png)
I think fear is more powerful than greed. These readings will show extremes unlike anything we’ve ever seen. The 2.04 reading in the Put/Call on December 21 was a stunner but before this bear is done I think we’ll see even higher. Near the end of the bull market we saw the most extreme low put/call readings ever recorded. We’ll see the same thing in the opposite extreme before this bear is done.