The 5-day average equity put:call ratio is now right at the mean:

Source: indexindicators.com

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You can see that the 20-day average still has a long ways to go, which means that the 5-day is likely to spike well over the mean in the next wave (a 3rd wave?) down. I’m looking for summer 2007 conditions to counter the extreme complacency that we’ve had since August, which suggests that we have another 5-10% on the downside in this move after any countertrend bounce from here exhausts.

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As far as that anticipated bounce goes, the VIX also threw its hat in the ring, offering a buy signal by closing back within two standard deviations of its 20-day average.

Source: stockcharts.com