What Are P/C Ratios and How Do I Use Them?

Jesus posts a chart of the Put/Call (P/C) Ratios throughout the day.

P/C Ratios display the total amount of put buying vs. call buying.
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When the P/C Ratios spike, there is more put buying than call buying and vice versa.

Many traders consider a long bias when the P/C ratios are elevated and a short bias when low. When P/C ratios are elevated, there is a good amount of hedging taking place, and these hedges eventually have to be unwound.

When P/C ratios are low, there is not enough hedging, which could lead to some downside in the market as players scramble to add hedges into pullbacks.
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As seen above, the ratios are represented as follows:

Questions or suggestions?

Please reach out if you have any further questions or suggestions.