In addition to the moderate oversold readings, the put/call ratios are now giving a buy signal. The 10 day moving average of the CBOE put/call ratio is posted below. While we are not seeing the same amount of put buying that we did during the Japanese nuclear crisis, this is the second most amount of put activity we have seen since September.
The CBOE equity only 10 day moving average is nearly where it was after the Japanese nuclear crisis.
The ISE equity only is actually showing more put buying than during the Japanese nuclear crisis.
There does not seem to be that much fear and we have not seen a scary decline, so I would take these readings with a grain of salt. I would be very surprised if we saw a rally anywhere approaching the one we saw after the Japanese nuclear crisis. I don't believe this is a great buying opportunity but these readings should at least be good for a bounce and will keep me biased to the long side.