The pattern as of late has been one really ugly day, followed by an up day, then another really ugly day.

Wednesday was a really ugly day.

That must mean Thursday will be an up day.

The catalyst on Thursday may be the SEC's expedited new rules for shorting.

Which sets us up for a another really bad day on Friday as investors get spooked for yet another weekend of surprises!

Frankly, I have no idea how the market will play out over the next few days other than I think a near-term bottom is approaching. 

I postulated this theory to someone today and they asked me what was my catalyst?

I have no catalyst.  I have no idea. 

Often, at the bottom there is no catalyst.   The bottom occurs in a cathartic selling episode of disgust.

And right now, the level of pessimism is high.

But maybe not high enough.  Fear and disgust seem to be the mood of investors, but the market does not seem sufficiently fearful or disgusted.

I want to see an extreme oversold condition and the technicals telling me a bounce is a no-brainer.

We are not there yet.  We are getting there but we need a few more really bad days.

A sell-off Friday and a horrible Monday might do it.

Now, I'm talking about a near-term bottom, not the bottom.  I think there is more pain to come.

And I will offer you the least helpful piece of advice you will have heard this week (at least advice that is not from Dennis Kneale) - though I think we are approaching a near-term bottom in relation to time, I have no idea what the bottom will be in terms of return.

Maybe the bottom is another 200 Dow points away.  Or maybe its 2000.

I remain very, very short, but I will be looking to cover my shorts over the next few days.