After rising 20% over 15 trading days - the fastest ascent since 1938 apparently - the market is taking a breather, with the S&P 500 falling 5.4% over the past two days.

The two-day decline has been on light volume.  NYSE Composite volume was 5.5 billion on Friday and 5.7 billion today, the 32nd and 27th lightest volume days over the past 34 trading sessions respectively, which marks the sell-off that began on February 10 and the subsequent rebound starting on March 6.

The volume statistics have been interesting.  Over 17 trading days beginning on February 10, the S&P 500 fell 21.5% to the closing low on March 5.  Average daily volume during the decline was 6.6 billion.  Over the next 15 trading days, when the market rallied 22.0% until the closing high last Thursday, average daily volume was 7.3 billion.

The largest volume day was on March 18 at 8.94 billion when the S&P 500 rose 16 points to 794.  There have only been two other 8 billion plus volume days during this period, both down days - the following day on March 19 at 8.86 billion when the S&P 500 declined 10 points, and on February 27 at 8.74 billion, when the market fell 18 points to 735.

However, the lightest volume days have tended to be on declines.  Of the eight days with volume below 6 billion, six of them have been down days, including the last two.  The only two up days on light volume were on February 11 and 12.  The next four days were all down on light volume, with the market falling a total of 56 points and no trading session exceeding 6 billion.

Thus, it appears that the market has been selling off on lighter volume and rising on heavier volume.

It should be noted, however, that even though the past two trading days have been declines on light volume, volume was also light at the beginning of the sell-off in February before it picked up on higher volume.  Thus, simply because the last two days have been light does not mean markets cannot go lower on rising volume.

Some investors argue that bear markets end on capitulation bottoms, with heavy selling occurring at the ultimate low.  This can be the case but it is just as likely that bear markets exhaust themselves, exhibited by selling on volume that becomes lighter.  It may be that the bear market is in the process of exhausting itself.