By now I'm sure you know how I feel about the market since for a while I have been saying a short-term rally would come, and then back down.
I have shown you some various indicators that I believe support that view. Let's look at another.
About 10-days ago I showed the 10-day moving average of TRIN (the Trading Index) noting that when it gets up and over 1.20 and then turns back down, the market is in oversold territory.
Over the course of the last week, we saw the TRIN reach 2.10 a week ago on Aug. 12, followed by an extraordinary reading of 3.72 a few days later on last Wednesday. At the time, I explained that we don't often get over 2.0, so a reading at almost 4.0 was literally "off the charts."
This brings us back to the 10-day moving average, which as you can see, has skyrocketed to over 1.50. The first thing to note is that this is higher than it got even in the fourth-quarter decline. It's more than the January and February 2018 decline as well. In fact, we have to go all the way back to 2015 and 2016 to see the kind of selling we saw last week, using this indicator. I have boxed those off in red on the left side of the chart.

Notice that these types or readings don't occur often and they tend to occur in violent markets. All the way on the left, in July 2015, you can see this indicator reached over 1.50. The S&P 500 enjoyed a rally-- a small one, but still a rally. But then you can see we came back down.
The second spike up that took the indicator to just over 1.70 arrived in August of 2015, which was accompanied by the plunge you see in the S&P of nearly 10%. Now squint even further, and you can see the rally in September - off that August low -- and how we came back down in late September and early October to form a "W" in the S&P.
See the spike in the indicator in early January 2016. That too was accompanied by a plunge in the S&P. We rallied for a week or two and came down again into early February, where we formed a "W," with a lower low in the S&P.
All of those instances are examples of a rally and back down again. I'm sure if I went back in time I could find a few examples when this indicator got this high and did not rally and come back down, but this is more typical as you can see.
I'd love to tell you Friday's rally changed my view, since there was nearly 90% of the volume on the upside that day. Or because the 10-day moving average of the stocks making new lows turned down. Or because for the first time since July the small caps outperformed. Or because breadth was good. Or because the 10-day moving average of the put/call ratio looks as though it might have peaked. These are all reasons for a short-term rally. But it's those intermediate-term indicators that keep my view the same.
The Oversold/Overbought Oscillators