This is an update of my Aug. 9th post on the accumulation/distribution situation.  See that post and its preceding ones for definitions of the indicators and terminology I use here.  Shown here is a daily chart of my accunm/dist indicators extending all the way back to mid October of 2008 in order to see the longer term behavior.

In the first part of this chart, during the steeply declining market up to mid January of 2009, we see in the upper pane that average down volume was significantly above up volume, as would be expected in a downtrend.  But for about two months before the March 2009 market bottom, there was little significant difference between these two curves, which means that the negative sentiment behind the market had dissipated, a leading indicator of the end of the downtrend.

From March through June of 2009, up volume was robustly aove down volume, consistent with the strong up market.  But, from July through September 2009, the two curves were nearly the same.  And from Oct. ‘09 all the way through to the top of the market in mid April of this year, down volume was strongly above up volume.  I take this as a very long leading indicator that the sentiment behind the market had turned negative.  From the market top in mid April up to mid August of this year, down volume was very strongly above up volume, consistent with the market downtrend.

But, starting in mid August, the gap has closed, the first time this has happened since last October.  This is a very significant happening, and to my eyes looks a lot like what happened in early 2009 ahead of the market bottom and turn around to the upside.  This could well be the indication that we are at, or close to, a major market bottom, from which an intermediate to long term up trend will emerge.

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