The S&P is testing the year’s lows but is heavily oversold.

The bars on the chart are colored red when FGIC is -8 or lower (Extreme Fear) and green when FGIC is +8 or higher (Extreme Greed).   [ Please follow these links: original and update explanations how FGIC works. ]

Note the typical cluster pattern of Spike Bounce signals over the past 2 months.  In oversold markets, SB signals intensify in frequency showing the market's attempt to rally. 

A declining FGIC after a Spike Bounce suggests that the lows that generated the signal will be retraced (Points 1,3 and 4) while an upward FGIC after an SB signal (Points 2 and 5) indicates a likely bottom, at least temporarily.

Have a safe trading week,

Gianluca L.