The S&P 500 Index ($SPX) has established 1120 as a support area, but it remains negative in that it is trending downward.

Equity-only put-call ratios are still rising on their charts, meaning they are still on sell signals. However, the heights they have reached means that these indicators are extremely oversold.

Market breadth has been very one-sided, as massive numbers of traders are either bullish or bearish at the same time, it seems. Breadth conditions are currently neutral.

Volatility indices ($VIX and $VXO) have remained high, with two spike peak buy signals having occurred when $VIX backed down from extreme highs.

In summary, conditions are improving but there are no intermediate-term buy signals at this time. We will continue to view the market cautiously until put-call ratio buy signals are generated.

Lawrence G. McMillan is the author of two best selling books on options, including Options as a Strategic Investment, and also publishes several option trading newsletters.