The Put Call Ratio (PCR) is a market sentiment indicator that compares the number of put options traded with call options in the derivatives market. It helps traders assess whether market participants are bullish or bearish. A PCR above 1 generally indicates cautious or bearish sentiment, while a value below 1 suggests bullish expectations. However, it should be analysed along with open interest, options volume, implied volatility, and overall market trends, as the ratio alone cannot accurately predict future price movements.
