Chaff and Wheat

UPDATE 12:18pm EST: Here’s where the chaff separates from the wheat:

I think the chart is pretty clear although I admit that I’m liberal with that channel. Yen so far is not convincing me – kind of weak. Don’t get too married to the downside – I’m sitting on a boat load of puts but am ready to hede with some NQ or ES futures again if I see this upper border being breached.

UPDATE 12:26pm EST: Someone mentioned the p/c ratio but I now prefer the ISEE:

So if you fade the MMs and the institutions long put/call sentiment is:

All Securities: bullish
All Equities: bullish!
Indices and ETFs Only: bearish

Glad I’ve got SPY puts – LOL – but seriously this is a mixed bag. Can be interpreted in various ways – e.g. high bullish maybe bearish signal, or high reading might mean we get a snap back to the upside. Whatever – but what irks me is the discrepancy between equities and indices. Anyone any suggesions as to how to interpret this?

UPDATE 1:54pm EST: See, I told you guys to not get too comfortable with the short side. I’m taking a tiny hit right now on those SPY futures but fortunately I did compensate this morning with my NQs. If we breach 775 I might sell some puts against them as we then might see 790.

UPDATE 2:06pm EST: We bounced back from those lofty heights – I like that – clear cut and we didn’t spend much time up there. Let’s see what the next hour brings. I’m staying short and thick.