Short Term (lasts a few
hours to a few days): As it keeps pushing lower, the market continues to
accumulate more and more buying volume, which should soon serve to produce
a more sustainable short-term bounce than the ones we have been seeing on
an intraday basis (most of which were sold off). 5-day charts show the
surplus of buying volume that has been building up during most sessions
since February 26. 30-day charts of the NASDAQ 100, the S&P 500, and
the Dow give a broader perspective of the strong sell-off the market has
been seeing, and to what extent the major indexes have accumulated buying
volume (in green on the SBV oscillator pane) during this time.
Keep
in mind that the market - because it is now in a mid-term downtrend - will
tend to show stronger downside reactions to even comparatively modest
amounts of selling volume. In other words, for a sustainable recovery, a
significant amount of buying volume will be required.
In summary:
The risk remains for moderately lower levels on the major indexes, but the
increasing amounts of buying volume that have built up should soon prompt
a short-term bounce within the new mid-term downtrend (see Market
Stage).