The stock market has become extremely volatile, trading up and down hundreds of Dow Jones points in a day. But our indicators have remained steadfastly bearish throughout the last few weeks.

For example, despite several big rally days, $SPX never broke the downtrend line that connects its series of lower highs. Until that downtrend is broken, the $SPX chart will be bearish.

Equity-only put-call ratios remain on sell signals as the ratios are racing higher now. As long as they are trending higher, they are on sell signals.

Market breadth has been swinging wildly back and forth. Six of the last ten days have seen +/-2000 breadth. That is quite unusual. Both breadth indicators are on sell signals, and both are in oversold territory. However, the market can continue to decline sharply even while oversold.

Volatility indices continue to rise, even though they have had some wide swings, just as the stock market has. But the trend of volatility is higher, and that is bearish.

In summary, the intermediate-term indicators are all bearish, so even though oversold conditions are setting up potentially strong buy signals, do not act on these buy signals until they are actually confirmed.

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.