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This trading indicator returns the ratio of S&P 500 index to equity put-call volume. It gets the S&P 500 index (Symbol: ^GSPC using the following downloader Historical Stock Market Data) and divide it by the put/call ratio, which can be downloaded from Equity Put-Call Ratio.
The Equity put-call ratio is a sentiment indicator that measures the number of put shares traded and compares it to the number of call shares traded on a given day.
The value returned by this indicator can be used to detect trend changes. For example, an extreme value is often an indication that a bottom is reached and that an uptrend is likely to occur in few days.
The indicator, whose name is "SP_PutCall", does not use directly the put-call ratio raw values; instead, it calculates the 10-Bar simple moving average of this ratio and uses this measure in the subsequent calculations.
The same ratio can be obtained for individual stocks by dividing the close price of each U.S. stock by its put/call ratio. The formula that returns the put/call ratio of each stock is available here Put/Call Ratio for Individual Stocks. You may also generate these ratios from the raw put and call volume that are downloaded using Individual Stocks Put and Call Volume.
It is also possible to compute the ratio for a different index. To do this, update the indicator to display its formula then change the "index" value of the first line. For example: string index = "$SPY";
Trading financial instruments, including foreign exchange on margin, carries a high level of risk and is not suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in financial instruments or foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.