It looks like we are definatetly past the point of no return in this current downturn. In my opinion we have to experience some type of capitulation/panic selling, as we have had so many days of orderly selling in the past weeks and people will start to lose it soon. Many investors/traders who tried to hold the long positions through this consant selling pressure will soon capitulate and possibly set up some nice opportunities on the long side, but patience is a must here.

Right now, the options equity put/call is rising, but it’s the only indicator of mine that is remotely bullish. It’s going to take a few hitting extremes in unison that will give me the confidence to go long.With the Vix just starting to pick up and well off it’s highs, this could be another extended slow motion multi-day crash that wears the bulls down. I still haven’t covered any of my shorts this morning, as no signals have been generated.

I would be careful entering new shorts here, and will run some scans in an hour or two and see what types of patterns I see going into the close. If the market rallies into the close it may be an opportunity to get short for tomorrow, but that depends on the strength of the rally. I really can’t see many investors sticking their necks out and buying this market.