If we are to look at the markets, strictly on a technical perspective, it is hard not to be bearish here.
The SP500 and the Nasdaq both look to want to test the 200 SMA, which typically is support area for consolidating markets when mature into a rally.
Make no mistake, the markets are very very oversold and I am very hesitant about shorting it here due to the oversold condition, and on a valuation basis on key market players. (IMO, the easy money short, has been made.)
In fact, I have been slowly entering names, and am eagerly awaiting target prices on other names, as I previously mentioned, to enter.
I do not know if the markets will contract just yet to the 200 SMA, or if the markets will churn and meet the 200SMA at some point in the next few weeks. The only thing I do know, is what I will do. If markets continue to decline to the 200SMA, we will approach valuation of Nov 2008/March 2009 and I will go 'all in'.