Well, so much for the "moderate buy signal". There was a reason I gave it a moderate buy as opposed to the "all in" buy and that's because of some missing links. As I mentioned a couple days ago, the VIX although showing fear earlier when it spiked to 27, collapased very quickly on just the slightest of bounces which was indicating complacency (but now it's spiking again). Also, as mentioned before, Rydex indicators are not all on board (although a couple are). I would also like to see more pessimism from AAII sentiment figures. The current figures this morning showed a 1:1 ratio of bears vs bulls. I was a bit suprised by this because during the past 10 months a 5% drop usually caused more pessimism. The fact that the ratio is "only" 1:1 indicates a bit of complacency although it's not dangerous complaceny by any means. At prior "all in" buy signals (July and November lows) we saw a ratio of about 2:1 bears vs bulls.
So, in conclusion I will give props to the bears here for taking the market down even though there was some big oversold signals. I'm begining to wonder if the real concern about the market is about the re-apointment of Bernanke which appears will be decided shortly after 3:20. I think it would be a negative if he's not. Apprently, odds suggest he will be reapoined but is the market suggesting no or is this just panic selling? We're going to find out soon.
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