Now that the Fed meeting is over, and they didn't raise rates (as we have been predicting), what do we really know? Stocks rallied strongly heading into the announcement, and then there was heavy buying right after the announcement. But the party on Thursday didn't end well, with sell programs emerging that knocked $SPX back down and held $VIX up. So, in reality, we'll probably have to wait to see if there is further confirmation of the strength, or if the bulls used up all their ammo in that one spree.

A close above 2000 would still be needed in order to say that $SPX has finally broken through the 1990-2000 resistance area. On the downside, if $SPX closes below 1960, then the bears would be in charge once again.

As for the put-call ratios, all three are pretty much in agreement: they are still at or very near their highs. At a minimum that means they are oversold and they appear to be near buy signals soon.

Market breadth has been improving recently, and both breadth oscillators are on buy signals.

Finally, volatility has been decreasing, but we are still going to stick by our previous thinking that $VIX is in an uptrend -- and thus bearish for stocks -- as long as it closes above 19. A close below 19 would change $VIX into a bullish indicator for stocks.

In summary, conditions are improving, but I would prefer to see confirmation from $SPX in the form of a breakout above 2000 in order to confirm any buy signals. Otherwise, the intermediate-term outlook remains bearish.

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.