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Put Call Ratio

INDEX

PCR OI

Symbol
Put
Call
Ratio

NIFTY

20,12,73,995

31,06,53,245.00

0.65

Note: OI Figures are in Thousands

PCR Volume

Symbol
Put
Call
Ratio

NIFTY

2,64,84,13,425

2,64,37,39,950.00

1.00

Note: Volume Figures are in Thousands

STOCKS

PCR OI

Symbol
Put
Call
Ratio

25,66,800

34,89,300.00

0.74

19,01,76,500

34,65,16,200.00

0.55

3,21,84,000

5,02,56,000.00

0.64

28,35,000

34,35,000.00

0.83

3,26,25,500

3,18,50,400.00

1.02

64,83,125

1,24,44,525.00

0.52

76,50,330

1,22,88,495.00

0.62

7,37,000

14,95,450.00

0.49

35,52,000

55,23,600.00

0.64

2,58,72,975

3,73,02,750.00

0.69

6,44,500

8,81,750.00

0.73

15,31,250

23,30,650.00

0.66

33,25,600

83,88,900.00

0.40

4,57,500

11,88,000.00

0.39

6,30,250

13,77,750.00

0.46

36,28,450

72,08,600.00

0.50

21,05,400

32,33,500.00

0.65

4,00,000

6,57,600.00

0.61

66,45,000

1,19,01,000.00

0.56

1,11,38,400

2,36,81,875.00

0.47

49,68,800

66,25,600.00

0.75

6,94,37,500

12,56,31,000.00

0.55

2,26,18,550

2,66,27,800.00

0.85

2,73,44,800

4,34,32,800.00

0.63

10,08,000

8,64,700.00

1.17

32,10,350

54,25,750.00

0.59

14,13,300

20,86,000.00

0.68

34,30,700

59,04,600.00

0.58

20,72,000

26,85,000.00

0.77

2,57,950

4,66,200.00

0.55

40,36,550

97,48,550.00

0.41

10,65,400

15,16,000.00

0.70

35,34,300

50,79,900.00

0.70

3,52,875

5,62,125.00

0.63

82,77,875

2,02,10,000.00

0.41

8,74,250

23,77,750.00

0.37

56,21,550

98,98,350.00

0.57

61,775

93,850.00

0.66

3,97,97,250

7,41,39,750.00

0.54

18,45,000

48,06,750.00

0.38

64,80,800

1,31,37,600.00

0.49

2,47,07,900

4,22,06,000.00

0.59

37,24,875

1,15,48,625.00

0.32

2,42,39,500

5,31,85,000.00

0.46

1,90,47,225

2,81,80,050.00

0.68

1,40,81,125

1,63,86,175.00

0.86

10,79,550

17,00,100.00

0.63

37,85,000

71,22,500.00

0.53

1,37,59,800

2,63,92,900.00

0.52

32,38,500

49,77,600.00

0.65

9,14,125

13,59,625.00

0.67

10,61,550

15,82,000.00

0.67

15,73,000

22,88,000.00

0.69

8,85,36,000

10,90,64,000.00

0.81

3,00,300

5,21,150.00

0.58

4,85,750

9,39,000.00

0.52

8,08,150

13,37,000.00

0.60

12,22,200

18,59,200.00

0.66

1,66,33,500

2,47,75,400.00

0.67

91,00,800

1,41,46,200.00

0.64

6,77,700

12,89,400.00

0.53

35,22,000

46,07,250.00

0.76

76,08,150

63,72,750.00

1.19

22,79,400

43,59,900.00

0.52

26,100

87,165.00

0.30

2,06,34,750

7,60,90,500.00

0.27

49,42,000

81,35,400.00

0.61

3,60,975

6,99,525.00

0.52

12,48,450

21,71,750.00

0.57

1,08,87,500

1,32,90,625.00

0.82

2,44,54,500

7,70,49,000.00

0.32

9,49,05,000

15,65,59,500.00

0.61

1,15,96,800

2,16,38,400.00

0.54

16,17,750

22,42,500.00

0.72

38,25,900

82,78,200.00

0.46

1,50,86,500

2,81,77,500.00

0.54

14,96,250

30,46,125.00

0.49

1,98,67,500

3,04,61,250.00

0.65

11,86,075

26,45,500.00

0.45

9,68,550

10,13,100.00

0.96

1,60,47,400

2,47,31,200.00

0.65

13,83,200

23,64,800.00

0.58

14,98,400

18,28,800.00

0.82

18,79,875

30,50,000.00

0.62

10,81,675

20,16,700.00

0.54

12,98,850

30,51,825.00

0.43

9,65,600

30,14,800.00

0.32

43,70,400

77,38,800.00

0.56

6,36,075

11,94,750.00

0.53

1,03,26,000

1,75,41,000.00

0.59

53,31,208

82,24,000.00

0.65

30,97,200

58,97,600.00

0.53

23,66,400

37,51,050.00

0.63

6,34,650

9,67,950.00

0.66

2,24,12,626

3,47,50,056.00

0.64

32,64,975

83,45,050.00

0.39

10,66,050

14,72,400.00

0.72

23,42,200

53,90,000.00

0.43

57,57,000

77,06,000.00

0.75

1,83,34,500

1,61,78,900.00

1.13

21,08,000

33,13,600.00

0.64

60,22,400

80,18,000.00

0.75

3,01,500

8,28,900.00

0.36

3,75,550

6,03,750.00

0.62

2,61,000

6,24,200.00

0.42

46,44,775

58,52,675.00

0.79

36,41,250

83,31,250.00

0.44

56,66,625

82,33,650.00

0.69

56,14,000

99,53,000.00

0.56

10,78,650

17,70,550.00

0.61

3,99,99,350

6,28,20,200.00

0.64

38,03,750

51,89,375.00

0.73

2,50,80,000

4,83,74,400.00

0.52

1,54,31,750

3,74,51,000.00

0.41

1,62,66,750

3,69,49,500.00

0.44

47,68,750

69,43,125.00

0.69

1,27,72,450

3,14,17,425.00

0.41

4,20,03,000

6,44,32,205.00

0.65

88,81,650

1,96,66,050.00

0.45

1,22,18,000

2,20,75,200.00

0.55

86,32,600

1,59,13,700.00

0.54

93,40,800

1,75,00,700.00

0.53

25,91,400

33,92,250.00

0.76

18,65,000

28,95,000.00

0.64

71,22,000

99,43,000.00

0.72

35,95,350

49,31,850.00

0.73

69,54,750

1,34,06,250.00

0.52

2,14,01,250

2,94,56,250.00

0.73

9,22,67,705

13,14,08,205.00

0.70

62,31,19,060

1,06,86,22,675.00

0.58

39,70,100

86,96,850.00

0.46

13,64,350

37,36,525.00

0.37

1,27,86,900

2,41,47,200.00

0.53

98,29,050

1,64,11,350.00

0.60

1,31,55,275

2,23,84,425.00

0.59

73,34,100

95,56,500.00

0.77

1,11,11,175

1,53,98,100.00

0.72

79,36,750

1,51,42,100.00

0.52

93,08,600

1,86,07,400.00

0.50

1,96,85,400

2,95,02,300.00

0.67

21,30,150

36,97,500.00

0.58

1,08,39,400

2,40,25,100.00

0.45

1,55,91,400

3,27,08,500.00

0.48

7,28,250

12,88,500.00

0.57

63,89,600

1,67,85,650.00

0.38

29,12,500

30,12,000.00

0.97

31,05,450

62,04,750.00

0.50

11,06,000

22,74,500.00

0.49

22,40,300

44,72,000.00

0.50

18,18,025

30,65,975.00

0.59

19,59,500

28,07,500.00

0.70

3,97,29,600

7,39,69,875.00

0.54

74,02,125

86,57,250.00

0.86

2,59,43,400

4,59,08,100.00

0.57

16,77,100

24,89,300.00

0.67

2,97,60,000

4,31,60,000.00

0.69

72,70,200

1,12,96,800.00

0.64

2,56,17,700

4,12,85,625.00

0.62

9,31,000

16,67,750.00

0.56

49,66,250

1,06,90,625.00

0.46

16,52,850

31,53,300.00

0.52

95,89,800

1,78,05,975.00

0.54

8,13,050

10,84,350.00

0.75

6,53,300

12,08,700.00

0.54

44,79,925

63,39,125.00

0.71

3,69,850

8,38,825.00

0.44

1,38,95,000

1,51,22,500.00

0.92

9,92,375

15,17,250.00

0.65

6,71,200

7,85,200.00

0.85

41,38,200

66,25,800.00

0.62

48,67,500

81,63,750.00

0.60

13,88,925

14,17,500.00

0.98

28,62,750

55,66,125.00

0.51

2,46,80,700

3,54,94,200.00

0.70

27,62,625

54,40,875.00

0.51

31,08,750

40,51,875.00

0.77

29,35,500

60,86,650.00

0.48

35,71,700

49,39,350.00

0.72

54,95,500

1,40,17,875.00

0.39

44,25,100

83,63,800.00

0.53

7,15,56,750

8,56,44,000.00

0.84

8,13,300

11,39,550.00

0.71

43,51,100

95,60,200.00

0.46

1,07,22,375

1,86,83,625.00

0.57

4,52,375

6,70,000.00

0.68

1,22,43,025

1,78,57,950.00

0.69

2,83,375

5,20,100.00

0.54

16,87,725

17,18,925.00

0.98

1,55,32,500

2,12,60,000.00

0.73

1,64,82,375

3,10,24,875.00

0.53

87,45,225

2,18,09,625.00

0.40

24,37,000

42,60,000.00

0.57

4,68,73,950

8,41,91,850.00

0.56

17,29,975

36,92,325.00

0.47

1,90,73,600

3,45,38,400.00

0.55

3,82,38,525

4,42,08,455.00

0.86

2,14,84,800

4,06,04,400.00

0.53

9,45,900

17,57,700.00

0.54

1,60,06,500

2,02,85,250.00

0.79

39,91,500

75,71,000.00

0.53

8,64,675

13,86,225.00

0.62

1,50,59,375

3,42,11,875.00

0.44

29,51,300

41,84,950.00

0.71

48,43,000

59,57,000.00

0.81

18,76,000

38,11,500.00

0.49

12,87,750

35,89,975.00

0.36

39,42,250

90,51,500.00

0.44

2,20,00,000

3,34,00,000.00

0.66

10,62,250

19,60,750.00

0.54

17,43,350

23,01,250.00

0.76

26,85,250

41,02,500.00

0.65

62,37,000

93,16,650.00

0.67

1,79,300

3,28,200.00

0.55

2,03,250

3,36,500.00

0.60

55,98,350

78,76,925.00

0.71

42,62,400

67,10,400.00

0.64

67,80,600

79,04,700.00

0.86

23,37,525

33,33,150.00

0.70

11,67,600

18,28,800.00

0.64

1,98,48,400

2,91,95,400.00

0.68

1,29,70,400

2,06,98,700.00

0.63

12,03,000

19,09,875.00

0.63

38,26,600

85,99,250.00

0.44

5,52,000

10,05,500.00

0.55

Note: OI Figures are in Thousands

PCR Volume

Symbol
Put
Call
Ratio

5,81,400

22,33,800.00

0.26

88,32,400

4,07,41,000.00

0.22

1,93,14,000

3,14,13,000.00

0.61

3,24,750

9,52,500.00

0.34

36,46,650

54,03,850.00

0.67

92,77,275

2,30,06,125.00

0.40

87,34,330

2,02,65,380.00

0.43

3,71,250

21,05,950.00

0.18

10,64,800

51,81,200.00

0.21

1,34,16,600

2,01,60,300.00

0.67

1,08,400

3,19,700.00

0.34

4,31,550

8,89,700.00

0.49

8,35,500

27,41,500.00

0.30

2,92,125

3,30,375.00

0.88

4,98,250

33,75,500.00

0.15

9,47,800

26,46,875.00

0.36

2,34,900

9,30,175.00

0.25

80,600

1,75,800.00

0.46

1,91,16,000

3,22,03,800.00

0.59

22,21,625

70,38,325.00

0.32

9,67,200

18,67,200.00

0.52

1,94,97,500

3,74,55,000.00

0.52

1,14,57,900

2,06,11,750.00

0.56

69,12,800

1,37,35,200.00

0.50

2,67,100

2,78,900.00

0.96

9,90,000

26,88,950.00

0.37

4,50,100

7,67,900.00

0.59

6,91,600

19,48,700.00

0.35

10,31,000

24,13,000.00

0.43

63,875

2,39,750.00

0.27

15,79,550

45,20,600.00

0.35

2,65,600

4,98,400.00

0.53

68,48,100

2,76,07,650.00

0.25

86,775

1,31,550.00

0.66

5,58,125

20,79,750.00

0.27

10,29,375

20,43,000.00

0.50

7,80,450

22,07,700.00

0.35

3,500

9,825.00

0.36

6,81,33,750

17,06,34,000.00

0.40

14,05,875

26,39,250.00

0.53

15,39,200

28,18,400.00

0.55

31,72,500

1,07,11,300.00

0.30

1,04,500

9,57,000.00

0.11

70,55,000

1,36,79,500.00

0.52

27,97,350

72,45,825.00

0.39

1,98,94,550

2,75,30,425.00

0.72

12,71,250

67,54,050.00

0.19

30,35,000

96,42,500.00

0.31

12,71,100

39,63,400.00

0.32

2,92,400

3,55,300.00

0.82

11,92,750

21,52,125.00

0.55

4,11,250

7,05,250.00

0.58

2,28,800

9,40,550.00

0.24

5,29,44,000

10,07,60,000.00

0.53

53,025

91,525.00

0.58

60,250

3,28,250.00

0.18

2,75,450

17,19,200.00

0.16

5,69,100

18,15,800.00

0.31

44,48,600

66,09,200.00

0.67

8,29,800

13,60,800.00

0.61

1,83,300

4,62,200.00

0.40

13,38,750

32,16,750.00

0.42

43,63,775

41,58,600.00

1.05

24,48,900

69,20,700.00

0.35

14,250

61,500.00

0.23

51,03,000

1,25,57,250.00

0.41

4,38,200

11,85,800.00

0.37

56,400

1,82,625.00

0.31

2,27,500

10,80,450.00

0.21

33,18,750

98,40,625.00

0.34

66,72,000

2,07,45,000.00

0.32

2,96,19,000

13,62,01,500.00

0.22

10,56,000

41,15,200.00

0.26

5,20,500

16,16,250.00

0.32

9,69,300

75,68,100.00

0.13

30,29,000

98,67,000.00

0.31

1,63,875

3,81,375.00

0.43

45,48,750

1,43,62,500.00

0.32

3,12,400

4,12,225.00

0.76

1,51,525

1,14,400.00

1.32

23,94,400

54,20,200.00

0.44

6,05,600

48,03,200.00

0.13

73,67,200

34,75,200.00

2.12

6,38,750

13,69,250.00

0.47

2,27,675

6,60,275.00

0.34

1,78,500

8,88,300.00

0.20

5,44,700

10,95,550.00

0.50

7,30,800

23,86,800.00

0.31

2,35,575

10,85,175.00

0.22

14,16,000

51,18,000.00

0.28

2,26,160

5,26,336.00

0.43

35,69,400

75,18,200.00

0.47

5,34,225

21,19,900.00

0.25

7,85,250

11,00,400.00

0.71

58,58,606

96,33,458.00

0.61

9,39,400

20,92,300.00

0.45

2,67,750

4,62,600.00

0.58

1,97,400

8,08,500.00

0.24

17,38,000

57,05,000.00

0.30

51,25,500

49,72,500.00

1.03

1,72,400

6,52,800.00

0.26

16,74,400

36,26,400.00

0.46

27,000

91,350.00

0.30

5,24,300

25,00,575.00

0.21

32,800

1,51,700.00

0.22

48,90,350

2,25,65,875.00

0.22

3,86,250

15,41,250.00

0.25

10,48,950

18,09,675.00

0.58

16,95,000

46,64,000.00

0.36

76,500

1,94,650.00

0.39

1,38,18,000

2,60,35,650.00

0.53

4,56,250

11,99,375.00

0.38

79,00,800

1,54,00,000.00

0.51

36,50,750

52,95,500.00

0.69

11,04,000

44,81,550.00

0.25

4,55,875

23,66,000.00

0.19

2,68,525

35,72,550.00

0.08

54,55,125

1,46,78,775.00

0.37

34,18,500

77,81,925.00

0.44

42,14,400

69,72,400.00

0.60

6,25,600

23,00,100.00

0.27

1,16,36,100

2,03,51,800.00

0.57

27,77,850

37,08,600.00

0.75

9,26,000

15,67,000.00

0.59

43,91,000

96,27,000.00

0.46

6,51,750

5,82,450.00

1.12

7,48,000

27,14,250.00

0.28

76,68,750

1,17,22,500.00

0.65

1,06,84,800

4,08,10,000.00

0.26

3,40,22,100

17,52,56,700.00

0.19

19,08,275

40,11,725.00

0.48

14,73,875

37,97,300.00

0.39

85,65,200

1,36,67,500.00

0.63

22,69,950

19,98,000.00

1.14

8,75,875

26,01,900.00

0.34

11,80,800

15,02,700.00

0.79

43,35,525

60,79,050.00

0.71

34,450

1,66,950.00

0.21

48,60,800

1,30,08,800.00

0.37

7,41,750

29,60,550.00

0.25

8,42,550

26,46,300.00

0.32

70,75,200

1,70,74,200.00

0.41

57,87,650

1,17,48,000.00

0.49

5,43,300

16,04,250.00

0.34

21,32,200

56,55,650.00

0.38

6,16,500

7,68,500.00

0.80

3,87,750

16,48,200.00

0.24

3,32,000

5,20,250.00

0.64

18,39,325

95,12,675.00

0.19

18,93,925

81,88,950.00

0.23

3,15,500

19,58,500.00

0.16

3,99,31,875

8,31,21,075.00

0.48

98,30,250

1,96,29,375.00

0.50

24,34,950

62,27,550.00

0.39

1,38,725

3,31,700.00

0.42

74,20,000

97,30,000.00

0.76

31,82,400

53,49,600.00

0.59

1,98,02,550

2,89,93,300.00

0.68

3,88,675

16,23,475.00

0.24

3,31,875

13,86,875.00

0.24

2,68,350

7,34,400.00

0.37

70,81,800

1,93,83,375.00

0.37

4,05,800

9,09,750.00

0.45

2,41,700

4,73,200.00

0.51

16,03,975

25,91,675.00

0.62

36,075

1,31,300.00

0.27

20,12,500

31,26,250.00

0.64

34,850

3,20,450.00

0.11

2,55,200

7,24,200.00

0.35

2,53,800

6,21,000.00

0.41

3,33,750

11,75,000.00

0.28

81,000

1,91,700.00

0.42

4,05,750

7,69,500.00

0.53

23,98,950

50,70,600.00

0.47

4,44,000

12,58,875.00

0.35

5,91,875

11,48,750.00

0.52

5,22,500

15,98,850.00

0.33

5,95,850

33,88,950.00

0.18

4,35,000

23,41,750.00

0.19

8,99,650

20,71,000.00

0.43

2,58,39,000

4,07,83,500.00

0.63

1,21,650

3,13,800.00

0.39

5,64,200

9,77,600.00

0.58

73,06,500

85,66,500.00

0.85

2,59,125

5,64,250.00

0.46

35,70,800

70,46,800.00

0.51

1,60,200

4,80,050.00

0.33

12,61,325

64,67,825.00

0.20

38,00,000

87,35,000.00

0.44

32,76,000

65,62,500.00

0.50

23,08,500

65,06,075.00

0.35

4,74,000

13,54,500.00

0.35

1,08,95,550

2,55,95,850.00

0.43

7,54,650

16,65,950.00

0.45

26,67,600

83,87,600.00

0.32

2,17,29,825

3,11,22,000.00

0.70

84,60,000

1,71,97,200.00

0.49

23,57,700

1,06,20,600.00

0.22

58,85,250

54,33,750.00

1.08

15,69,000

22,15,000.00

0.71

3,30,600

4,95,525.00

0.67

87,26,875

1,26,77,500.00

0.69

4,92,250

13,10,650.00

0.38

14,75,000

18,91,000.00

0.78

2,14,375

8,32,125.00

0.26

8,98,450

70,89,425.00

0.13

8,73,750

16,75,500.00

0.52

45,65,000

91,05,000.00

0.50

5,42,875

12,81,375.00

0.42

78,050

2,41,150.00

0.32

8,62,750

9,67,750.00

0.89

8,06,400

17,55,600.00

0.46

70,700

1,47,500.00

0.48

43,500

1,23,250.00

0.35

9,41,450

24,82,350.00

0.38

12,45,000

23,27,400.00

0.53

5,08,200

15,69,900.00

0.32

1,22,850

5,40,000.00

0.23

1,35,300

2,86,500.00

0.47

5,09,600

32,24,000.00

0.16

18,22,800

47,46,100.00

0.38

41,38,375

62,68,375.00

0.66

3,77,625

8,54,625.00

0.44

3,02,000

9,36,500.00

0.32

Note: Volume Figures are in Thousands

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What is the Put Call Ratio?

The put and call ratio, commonly referred to as the PCR ratio, is a widely used technical indicator that helps analyze market sentiment by comparing the traded volume of put options against call options. A high PCR ratio live suggests bearish sentiment, while a low put call ratio signals bullish market conditions. This metric helps traders understand market optimism or pessimism.

How is PCR Calculated?

PCR can be calculated in two ways:

  1. Based on Open Interest

The Nifty put call ratio is derived by dividing the total open interest in put options by the total open interest in call options. Open interest represents unexercised and unexpired option contracts.

Formula: PCR = Total Open Interest of Put Options / Total Open Interest of Call Options

Example: If ABC Ltd. has:

  • Put options open interest: 2,000 contracts
  • Call options open interest: 5,000 contracts

Then, the put call ratio nifty is calculated as: PCR = 2,000 / 5,000 = 0.4

  1. Based on Trading Volume

The put call ratio today can also be calculated by comparing daily trading volumes of put and call options.

Formula: PCR = Total Trading Volume of Put Options / Total Trading Volume of Call Options

Example: If ABC Ltd. has:

  • Put options trading volume: 4,000 contracts
  • Call options trading volume: 16,000 contracts

Then, the put call ratio live for that day is: PCR = 4,000 / 16,000 = 0.25

How to Analyse PCR (Put Call Ratio)

Here’s a breakdown of PCR analysis depending on different scenarios:

  • Scenario: The Put Call Ratio Nifty rises as small declines are bought into an upward-rising market
    Signal: Positive
    Interpretation: It means that the upswing is expected to continue as put writers are actively engaged in writing during dips.
  • Scenario: The Nifty Put Call Ratio falls low as markets are gauging the levels of resistance
    Signal: Bearish
    Interpretation: It reflects that call writers are opening fresh positions expecting either a market pullback or restricted upside.
  • Scenario: The PCR is dropping in a declining market
    Signal: Bearish
    Interpretation: This means that option writers are selling call option strikes aggressively.

The Nifty put call ratio live chart is a powerful tool for traders to interpret market trends:

  • Rising PCR in a bullish market → Positive Signal: Suggests a continuing upswing as traders actively buy into declines.
  • Declining PCR in a bearish market → Bearish Signal: Indicates aggressive selling of call options, suggesting market weakness.

How to Trade Using a Put-Call Ratio

The rules and guidelines for PCR trading are as follows:

  • Identify Extremes: Look at the historical PCR values where the ratio reaches extreme values. Extreme peaks often mark overbought bearishness, which is typically taken back with a bullish reversal. Downside extremes may mark overbought bullishness, which is often taken back through the market pullback.
  • Use the PCR in Combination with Other Indicators: Most traders prefer to use PCR technically combined with other technical indicators. They tend to combine PCR either with moving averages or with the Relative Strength Index (RSI) in order to confirm the signals arising from PCR. This happens mainly to eliminate false interpretations and enhance strong trading decisions.
  • Market Context: Always look at the broader market context. If the PCR is high for an extended period of a downtrend, it may only be extending the bearish outlook. Conversely, this level of PCR in a sideways market might only suggest an oversold state.

To make informed trading decisions, traders use the PCR ratio live alongside other indicators like Relative Strength Index (RSI) and moving averages.

  1. Identify Extremes: High PCR suggests bearish overreaction, while low PCR indicates bullish saturation.
  2. Confirm with Other Indicators: Combining put call ratio nifty analysis with RSI helps minimize false signals.
  3. Market Context Matters: Extreme PCR levels in a sideways market might suggest oversold or overbought conditions.

Why is PCR Important?

PCR is one of the most significant measures that traders use when gauging market sentiment. The PCR live helps traders identify the underlying price movement of the security and guides them through placing directional bets on equities.As a contrarian signal, it helps traders avoid the pitfall of herd mentality.

Another way in which the Put/call ratio is used to study overall trading activity by market players is that it measures in terms of both open interest and volume.

PCR plays a crucial role in market analysis:

  • Sentiment Gauge: Helps understand market optimism or pessimism.
  • Contrarian Indicator: Extreme values signal potential trend reversals.
  • Risk Management: A high put call ratio may trigger protective measures.

Advantages of Put Call Ratio

  • Market Sentiment: PCR captures a snapshot of market sentiment and helps to trade towards a bullish or bearish interpretation from the market perspective.
  • Contrarian Indicator: It behaves as a contrarian sign. An extremely high or low PCR may indicate the approach of mood change in the market or an upbeat or depressive attitude.
  • Risk Management: Tracking PCR helps traders understand risks and make better decisions. A bearish PCR may lead to protective action, whereas a bullish PCR encourages greater risk-taking activities.
  • Volatility Indicator: As many traders and investors are buying put options as some form of hedging against the negative risks that may prevail, a higher rise in PCR is generally linked with increased market volatility.
  • Leading Indicator: The PCR can sometimes act as a leading indicator when extreme levels are reached.

Disadvantages of Put Call Ratio

  • Subjective Interpretation: The determination of what constitutes an “extreme” level would be subjective and may vary from trader to trader.
  • False Signals: As with any indicator, the PCR can produce false signals, especially if used without any other technical or fundamental analysis metrics.
  • Lagging Nature: The PCR reflects previously traded option activity that doesn’t necessarily translate into near-term price movement.
  • Market Context Dependence: The relevance of the readings might depend on the range, trend, or reversal stage that the market finds itself in.

4 Ways to Interpret ‘Nifty Put Call Ratio Live Chart’ and Nifty Spot Correlation

  • Trend Confirmation: A positive PCR amplified by increasing Nifty spot price would confirm that the bull trend is not over yet.
  • Reversal Signal: An extremely high PCR accompanied by a falling Nifty spot price could be a hint that the market is oversold and due for a reversal.
  • Bearish Divergence: When the PCR goes upwards, in contrast, the Nifty prices do not move up or go down, which indicates that more bullish sentiment turns bearish.
  • Bullish Divergence: It is a situation in which the PCR goes down, but the Nifty spot price shows as steady or rising. This might reflect that bearish sentiment is dropping, and bullish momentum may start rising.

Interpretation of PCR

  • PCR < 1: It suggests that more open call contracts are present than put contracts. It also means a bullish market sentiment where traders and investors believe the price of the underlying asset will rise. More call contracts than put contracts = Bullish sentiment
  • PCR > 1: If PCR is greater than 1, then the number of put contracts is higher compared to the number of call contracts, and hence, it portrays a bearish market psychology. The traders, as well as investors, think that the value of the underlying asset will go down. More put contracts than call contracts = Bearish sentiment
  • PCR = 1: When the PCR stands at about 1, this usually indicates market opinion is fairly neutral since there is little crowd psychology geared toward shorting or longing, and a greater number of investors and traders have equally bullish and bearish opinions. Market sentiment is neutral, indicating balanced trading activity.

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FAQs

What constitutes a high PCR?

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A high PCR is typically above 1.0, meaning that the number of put options traded is higher than the call options.

What does a Put Call Ratio greater than one indicate?

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If the PCR is more than one, it then means that there have been more purchases of puts than calls by the traders, which means that the current market situation is bearish.

What is the ideal PCR ratio?

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It's likely that market volatility, earnings reports, economic events, and general market sentiment would all impact PCR.

What factors can affect the PCR ratio?

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It's likely that market volatility, earnings reports, economic events, and general market sentiment would all impact PCR.

Is a high put-call ratio good?

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It depends on perspective. A high PCR may indicate excessive bearishness, which contrarian traders may see as a bullish signal.

What is a bullish put-call ratio?

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A low PCR, generally below 0.7, is considered bullish as it reflects higher call option trading.

Is the put-call ratio a reliable measure to forecast future market conditions?

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While PCR can provide insights, it should be used alongside other indicators and analysis for more reliable forecasting.

How can I determine PCR results?

downArrow

PCR results can be tracked using financial data platforms that provide real-time options trading volumes and comprehensive charts.

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