The S&P500 has been consolidating around 4100-4200 level since mid April’21. The lack of market’s advancement has created extremely negative sentiment among the equity option traders, which bodes well for a potential bullish continuation into the end of summer.
The chart below shows a de-trended Equity Put/Call Ratio, which now stands at a historically very pessimistic reading. Most of the prior similar readings resulted in the market’s going higher.
The Equity Put / Call Ratio