At this point, the $SPX chart is still bearish, because it has a sequence of lower highs and lower lows. The equity-only put-call ratios continue to remain on sell signals. The weighted ratio continues to move higher almost every day, thus confirming its bearishness.

Market breadth is the lone positive area right now. Both breadth indicators improved enough this week to generate buy signals. Volatility indices ($VIX and $VXO) remain in uptrends, and that is bearish for stocks.

In summary, the market appears to be in the midst of an oversold bounce. That rally is likely to run out of steam soon. We remain intermediate-term bearish, in line with our indicators.

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.