Markets Neutral Again

On Tuesday all major stock market indices posted nice gains on increased volume. Although volume increased a little bit from the previous day it was still very light according to the two distribution days from the last week. However, the behavior is encouraging as last two day's action looks like a low volume test of the August 9 low. Yesterday's reversal was enough to put my model in NEUTRAL stage, meaning that I don't short and may buy at most one stock, anticipating a bullish reversal. For more aggressive buying I will wait for more convincing signal. For this to happen tarket should rally from this levels on solid volume and hold the gains and then post some sort of a breakout on very high volume (a follow through day).