Forex Talking

The CBOE Equity Put/Call Ratio tracks investors' trades in the options markets.
It's calculated by dividing the volume of put options by the volume of call options.
(Puts and calls are options contracts that give participant the right to sell-put-or buy-call-the underlying security at a specified price, during a specified time period.) Financial newspapers list the weekly ratios for the CBOE Equity Put/Call ratio.

we'll also hear it mentioned on financial networks. This also serves as a contrary sentiment indicator. The higher the options players' level of pessimism, the more bullish the outlook for the market. The lower the level of pessimism, the more bearish the outlook.

For example, A reading in the Put/Call Ratio of .80 or higher is considered bullish. Bearish signals flash when the ratio reaches .30.