Some very bullish signs IT wise....ST still questionable

AAII sentiment came in this week at almost a 2:1 ratio of bears vs bulls. This is in line with what happened near the July 2009 and November 2009 lows. Also, AMG data reported almost a near $17 Billion outflow out of equity funds in this week alone. Combine this with last week's figure and you got a $21 Billion dollar outflow. This is the biggest outflow by far since March 2009 and is a very bullish contrary indicator because these mutual fund saps have been getting whipsawed like crazy for over a year. They shunned the rally for the most part in 2009 and then finally started getting back in a couple months ago and now they have pulled out in 2 weeks everything they put in for the past 2 months.

This behavior from the dumb money above gives me confidence that this is indeed just a correction. It is also consistent with sentiment at previous bottoms. In the ST however, "market action" as I like to call it, is not favorable. This day looks a lot like the dead cat bounce day after the flash crash.... we gapped up huge and grinded higher into the close. That bounce had some follow through the next day but ultimately it failed.
Not all gaps however get filled especially when sentiment is very favorable in the direction of the gap. There's an unfilled gap in early July which powered the market out of a bottom. Given the very favorable conditions in sentiment as per above it tells me 1 of 2 things will happen

1) The correction is over and we will simply power higher from here for the next couple weeks without any major dips.

2) Any significant pullback...even a lower low to sub 1050 won't be too damaging and will lead to a major bottom.

Bottom line.....bears are doomed one way or the other.