The Put/Call Ratio is one of the simplest yet most powerful sentiment indicators available—and it’s built right into the EdgeFinder. This tool helps gauge investor sentiment by comparing the number of bearish bets (puts) to bullish bets (calls) placed in the options market.

What Is the Put/Call Ratio?

The Put/Call Ratio (PCR) measures how many put options (bearish bets) are being bought compared to call options (bullish bets) over a given time period. It’s calculated by dividing put volume by call volume:

Put/Call Ratio = Put Volume ÷ Call Volume

PCR > 1 → More puts than calls → Bearish sentiment

PCR < 1 → More calls than puts → Bullish sentiment

While modest PCR readings can support the prevailing trend, extreme levels often serve as contrarian signals—suggesting a potential turning point in market sentiment.

Why It Matters—Even If You Don’t Trade Options

You don’t need to trade options to benefit from the Put/Call Ratio. We regularly use this tool when analyzing forex, indices, commodities, and equities.

Why? Because extreme fear or greed in the options market often spills over into broader risk sentiment—creating potential contrarian opportunities. When fear dominates and put buying spikes, we could be near a short-term bottom. When call buying soars and greed is rampant, it might be a sign of a market top.

How We Use It in the EdgeFinder

We’ve built in clear thresholds for Extreme Fear and Extreme Greed to help you quickly spot sentiment extremes:

Above the Extreme Fear threshold → Traders are overwhelmingly bearish. This can signal a potential bullish reversal.

Below the Extreme Greed threshold → Excessive bullishness might warn of a market top.

The PCR isn’t used in isolation—but as part of a broader confluence of signals, it adds meaningful value to timing decisions.

Put / call ratio for Bitcoin

Video Tutorials

The Put-Call Ratio Explained: BEST Greed & Fear Sentiment Indicator

How To Use The Put-Call Ratio

How is Put-Call Ratio Calculated on the EdgeFinder?

Put-call ratio calculation

It's calculated by dividing the total number of outstanding put options by the total number of outstanding call options.

Frequently Asked Questions (FAQs)

View more FAQs here.

What time frames can you use the edgeFinder on?

The EdgeFinder gives directional bias and is not time based. Therefore, there is not a specific time frame that is best for the EdgeFinder.

What assets are included on the EdgeFinder?

Forex Majors:
AUDUSD, NZDUSD, USDZAR, GBPUSD, USDJPY, USDCAD, USDCHF, EURUSD

Forex Minors:
AUDCAD, AUDCHF, AUDJPY, AUDNZD, CADCHF, CADJPY, CHFJPY, EURAUD, EURCAD, EURCHF, EURGBP, EURJPY, EURNZD, GBPAUD, GBPCAD, GBPCHF, GBPJPY, GBPNZD, NZDCAD, NZDCHF, NZDJPY

Metals:
XAUUSD, PLATINUM, SILVER, COPPER

Energy:
USOIL

Indices:
GER30, US30, SPX500, US10Y, NAS100, JP225, UK100, RUSSELL

Bonds:
US10Y

Is the EdgeFinder realtime?

While the EdgeFinder is not necessarily realtime, it is fully automatic in its data collection. The EdgeFinder uses a variety of data sources and inputs. Most price data updates are on a 15 minute timer, while economic data updates every few hours. COT data updates weekly (as it only releases 1 time per week), and retail sentiment updates every 30 minutes.

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How to use the edgeFinder's put / call ratio