The sell off in the market towards the end of this week has been occurring on lower volume. The market seems to be working in a healthy consolidation similar to the consolidations in the middle and end of August.
As I have noted in prior posts, the below chart was first publish in 1991 by technical analyst Justin Mamis in a book titled The Nature of Risk. I believe we are still in the "denial" phase of the market and have yet to see returning confidence that might present itself as capitulation buying.
Certainly today's economic reports were mixed. Of interest was the Michigan Sentiment Index that came in at a better than expected 73.5. The estimate was 70.5. Returning consumer confidence is critical since the consumer accounts for 70% of GDP. Later this weekend I hope to post a summary of recently released economic data.