Some indices fared better than others. The NYSE is undoing much of the hard work it did when it broke past 2000 highs; a test of those highs at 7,202 would look the most logical area to seek support. As TraderMike noted , there is still much work to do before markets see a bottom, although the T2108 indicator he watches is a few points shy of hitting the 20% mark typical of oversold bottoms. The rich NYSE Summation Index remains a concern however, but at least the VIX closed over 30 (and may gap higher today to confirm at least a top in this indicator): The $TICK capitulated (a short term bottom) For a broader market recovery we will need to keep an eye on Tech, an early leadership group in a market bottom. Small cap participation will also be important to pull the broader markets higher. Yesterday's NASDAQ action was unusual in there was no major violation of 2008 lows, although it did manage this on a closing basis (which in many ways is worse). Unfrotunately, the Nasdaq Summatio

Well - I think Monday will be a down day, but is there anything to add from the Stockchart.com ers from last week? Yong Pan headed the list with an interesting mix of 3 neutral signals and 5 bearish ones. The prior bullish signals disappearing into the wind. Interesting to see the VIX relatively overbought even after 2-days of gains. Monday should see the VIX spike higher but maybe Monday will also be a gap down and rally???? Hard to say until the first 30 minutes of trading play out and a playing field is set. This second chart isn't so good for bulls; note CPC and percentage of stocks above 50-day MA: Will the S&P reach lower channel support (c1,160)? Maurice Walker had talked of this on Thursday: That push lower on the Qs, finetuned the divergence on the 60-minute chart and allowed the MACD in that timeframe to break its down trend. We are extremely oversold here and I expect the divergence between the MACD, RSI and the price chart to play out. Now that the MACD downtrend

Nothing to see here, move along: I have a post on the S&P and its relationship to the 200-day MA over on the Zignals blog . Get the Fallond Newsletter Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, market alerts and stock charts website

A solid one-day gain on heavy volume for many indices will have given bulls something to cheer. There wasn't a whole lot of technical change, other than a few moving averages were breached (once again) to the upside in what has been a tough whipsaw period. The one index which caught my attention was the Transports - for the Dow theorists. The DJ Transport Index closed just shy of declining resistance dating back to May of this year. There was a stochastic crossover, but the signal occurred above oversold levels. Trend strength is (very) weak - so the odds of a break are not very high, but if it was to happen then Friday would be a good day for it. Keep one eye on it at least. Futures point to a flat open as of 6 am ET. Get the Fallond Newsletter Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, market alerts and stock charts website

While the intermediate and long term charts point towards further declines, in the short term there appears to be tradable bounce opportunities; chiefly in tech and Gold. Richard Lehman's charts show indices in the mid-range of downtrends. His chart for GLD has longside merit over an intermediate time frame: What of Tech indices? On the daily time frame we have bullish harami crosses. In the Nasdaq there is an obvious support level around 2208 with upside targets of converged resistance and/or the 50-day MA: With the Nasdaq 100 the descent is steeper so declining resistance would appear to be the more logical target than the 50-day MA: All bets are off if the stop levels are taken out (especially on a closing basis) Get the Fallond Newsletter Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, market alerts and stock charts website

You would think with a 3.6% loss in a single day the market would reach oversold levels. Unfortunately not. Also compounding the problem is the lack of oversold conditions in the NYSE Summation Index: Having said that I would expect a bullish divergence in the Summation Index but it's likely not to occur until it gets into the -600 to -800 range. If there was no bullish divergence and the Summation Index continued its push higher it will create a situation where the indicator is overbought and the NYSE is stuck in a decline; setting up a crash scenario. Damned if you do...damned if you don't. Get the Fallond Newsletter Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, market alerts and stock charts website

Babak over at Trader's Narrative made a good case for a bottom (at least in the Dow), although current closing resistance could put in a spanner in the works over the short term: But Richard Lehman remains cautious There are some mighty strong influences on the trends these days, making them challenging to decipher, to say the least. Today's action rocketed upward, then back and then upward again, but not breaking any of the overall downtrends I can see. There is a bit of room before the downtrend lines get hit, but that resistance should be felt soon. The Fannie-Freddie takeover was a relief, and caused lots of short covering, but not what you would exactly call good news overall for where things are. That's why I believe this spike will end up being contained within longer term downtrends. The VIX was actually positive for much of the day, despite a healthy rise (indicating the smart money felt it would reverse back down soon), but I see the Sept VIX futures closing at a