Not only that but sentiment is again back to bearish extremes. We are even starting to see the haters & trolls appear again on the blog (generally a pretty good sign of an impending bottom), although not as much because gold and miners have for the most part completely decoupled from the stock market.
Not withstanding all of that the market is now just about as oversold as it was in March of `09. There are only 27 stocks in the S&P trading above their 50 DMA.
You can see from the chart these kind of oversold levels always spawn some kind of bounce and often bear market rallies begin out of these kind of oversold levels.
Considering how late we are in the intermediate cycle the market is due to put in an intermediate level bottom at any time.
Now just isn't the time to get brave and press the short side. Much safer to just let that trade slide on by than risk getting caught in an explosive bear market rally or a continuation of the cyclical bull which ever the case may be.