Edit: Haven’t read Robert McCurtain in a while. He looks at the markets in several different ways including activity in $OEX options. Click here.
Market has not bounced yet because today’s action looks more like a pause in the downtrend than a bounce, but we’re getting close to a situation where the market almost has to bounce. When or if the RSI 14 drops below 30, you just have to expect the market to react to that oversold situation. But this market is weak so while I’ll still be looking for a bounce should RSI 14 and other indicators hit extreme oversold levels, I think any bounce will ultimately fail after a few days. That, of course, is just my opinion which is subject to change without notice.
Daily chart of $SPX:
Today’s candle appears to be a Shooting Star which ought to be a reversal candle. To validate this candle, $SPX must close above today’s high before it closes below today’s low. One or the other the should happen by Tuesday’s close, if not sooner.