The short term indicators are at an extreme and should produce a bounce very soon. Even within the framework of a momentum market that I laid out yesterday this move is very extreme. The level of oversold and the put/call ratios are approaching the extremes seen the last two Summers, which ultimately led to strong bounces. I expect the current situation to resolve in the same manner.
There are some intermediate term indicators that are still not in place. This might mean we will have to come down again to get a better low after a rally. Rydex traders are too long, the Investors Intelligence survey is not at an extreme and I'm just not seeing the type of negativity one would expect after such a large drop.