Since the S&P 500 broke 1120 late yesterday afternoon we have seen an acceleration to the downside. Breaking important technical levels is helping us get capitulation as many of the remaining bulls are now tossing their towels. In my experience these are the best times to buy.
Most of the indicators I look at are at historic extremes that almost always lead to upside. Unless we get another Lehman Brothers I believe that this will once again prove to be true. I believe the odds of another Lehman Brothers are extremely low. While officials are talking tough there are massive rescue facilities being put in place. Lehman Brothers happened over the course of a weekend with nobody prepared.
The last bit of a decline is generally the scariest and this is no different. I believe the odds of a whoosh and a rebound today are very high. it is always darkest before dawn and it is pitch black right now.