Ready for a market charts Rorschach test? Your interpretation may depend on your point of view, though sell signals have been triggered

Here are some charts across the equities, oil and gold markets, as well as the volatility index, the US dollar and bond etf (TLT) - how you interpret them may well be a function of your point of view! One example being that we are entering a consolidation or mild correction that will be followed later by another rally leg up (and if you're really bullish, then a new secular bull!). Another being that "this is it" and it's on down to new lows. Certainly chart interpretation can be affected by one's feelings about fundamentals and the like - a type of "Rorschach" test! "The Rorschach test (also known as the Rorschach inkblot test or simply as the Inkblot test) is a psychological test in which subjects' perceptions of inkblots are recorded and then analyzed using psychological interpretation, complex scientifically derived algorithms, or both." http://en.wikipedia.org/wiki/Rorschach_test (where I also located that image, upper left, of Rorschach slide 10).

I've marked onto most of these charts some basic points about how they can be seen. One thing is for certain - many of us would like to have answers, yet the action is not definitive enough to give clear direction whether market weakness here is pointing to only a mild correction. It's similar to the comments I posted earlier about the UNG (natural gas ETF) - the market price movement looks concerning, but not technically triggered yet.

The banking index chart, upper right, I didn't add markings to, but you can see it looked like one of the strongest (if not the strongest) sectors today. I still have chart resistance marked for this index in the high $46's so we'll just have to see if it can push past that. From the Elliott Wave perspective, I don't think we can rule out its recent rise as being a "b" wave, meaning I don't think we can rule out a deeper pullback in this sector. Today's action did have relative strength but price can also be stalling out here or at slightly higher levels.

Another thing is for certain: a sell signal has been triggered for the broad equities markets, as you can tell from the McClellan Oscillator. It's something I show from time to time. At the bottom are the versions for the NYSE and Nasdaq, courtesy of DecisionPoint.com (via Stockcharts.com, you can locate there using the search box function for McClellan). As usual I added some markings - but if you see nothing else, you should notice that the Oscillator fell under the zero line which is a "sell signal." Theoretically the Oscillator cannot generate a new buy signal until it goes back over the zero line.

Perhaps the McClellan Oscillator will get support again, such as along one of the uptrending lines I marked onto it (as has happened before like back in June/July). The raw volumes, along with the Summation Index being relatively high, suggest that it's too early to call this a serious bearish slide. So I'm not going to jump firmly into the camp calling for new lows around the corner (even though I recognize it remains theoretically possible). On the other hand - I will suggest that the correction still looks like it's in the early stages here.