At this point we can almost say for certain that the bottom of the correction has already happened. We believe that we have just finished a short-term pullback and that the stock market will resume its uptrend soon, possibly tomorrow.

You can see from the chart below that last Wednesday the NASDAQ Composite was able to break above the resistance line formed from the top of it recent double bottom formation.  We believe that the last five days of trading have been a short-term pullback and that the index will not break below horizontal support in the 2410 area.

The S&P 500 is currently sitting right above its major support level as well. The index cleared the top of its double bottom formation last Wednesday and has since been in a short-term pullback. We do not believe that the index will break below the 1410 area.

The Russell 2000 is in the same situation as both the NASDAQ Composite and S&P 500. The powerful move last Wednesday pushed through strong resistance and the recent pullback has been healthy and mild. If the index falls any further, we expect support to hold in the 790 area.

The stock market's recent pullback had been expected and is likely over. Within days, if not tomorrow, the stock market should be resuming its uptrend.