The stock market finally took a hit this week, but it hasn't really changed the overall picture -- yet.

First, as far as the chart of $SPX is concerned, it is still bullish. Yesterday's low at 1635 has to be considered a support level as well as 1625-1630, and then the more important support at 1600. If that were violated, it would be bearish.

Equity-only put-call ratios have plunged in the past week, driving down to the lowest levels in more than a year. However, that is not a sell signal.

Market breadth took a pounding on Wednesday and much less so on Thursday. As a result, one of our breadth indicators has turned bearish but the other has not.

Volatility indices ($VIX and $VXO) have behaved in a rather strange manner this week: they have risen every day I'm going to say that $VIX is still bullish for stocks as long as it doesn't close above its Thursday high at 15.11.

In summary, despite the nervousness that Wednesday's action created, the picture remains rather bullish -- at least until actual sell signals materialize, which has not yet occurred.

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.