After a 238 point drubbing on the Dow one might expect some panic among investors or knee-jerk bearish reactions from market commentators. That would be an incorrect assumption in the current market environment. As the S&P faces a crucial test of key trend support, the equity put/call ratio is no where near a panic level (usually a reading above 1.0 is indicative of high levels of fear among retail investors) and total assets in Rydex bear funds have barely budged (another useful indicator of fear among retail investors):

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Equity only put/call ratio

Equity_put_call

Rydex Bear Index Funds Total Assets

Rydex_Bear

Total assets in Rydex bear funds with the S&P 500 index at the top - it is easy to see that spikes in Rydex bear fund assets have closely correlated with the bottoms of recent pullbacks

Meanwhile, while complacency abounds, this market is facing a key test of long-term uptrend lines over the next couple of days:

SPY (weekly)

SPY_Weekly_10.1.2014

SPY (daily)

 

SPY_Daily_10.1.2014