Very interesting topic. I have also been watching the daily charts and regret that I didn't go long in stocks at the low this month which were also around the August lows. But in my view the battle isn't over yet. Correct me if I'm wrong, but doesn't the 200SMA play a vital role here as well?
Seems to me it is a significant S/R point and indicator of the status of a market.
In the first chart you can see the regular dow as it is hovering above the 200 SMA S/R point for 2 days now, and closed above it for 3 days, which I see as a good sign. Am I right? It shows that the market has some will to stick it out.
In the second chart is the YM chart, where the 200SMA appears to be a more significant and accurate S/R point. Here it has not cleared the 200SMA yet.
So one thing I'm looking for to go long is a breakout from the 200 SMA. And also what the fed is going to do. This article says that they may have hinted of a rate cut:
http://www.chicagotribune.com/busine...,1221075.story