1. Investors Intelligence survey
The investing climate is unsettled, and the broad capitulation that generally heralds the end of a market downturn hasn't happened, said Kathy Bostjancic, a senior economist at Merrill Lynch & Co.
2. New highs/new lows
"You can try to call a bottom when there's a lot of pessimism," Arbeter said, "but the market doesn't normally start to right itself until sentiment moves away from bearish extremes -- and that's what we're starting to see."
The credit crisis may have peaked, but the consumer crisis is just beginning, and historically stocks do not post extended rallies when consumer sentiment is so weak.
3. Discretionary consumer spending
Consumer discretionary typically is the first to fall heading into recession," Swanson said, but it also rebounds earlier than other market sectors.
'My general market outlook is that the worst is over. Not that the consumer is doing great, but the bad news is out.'
— Marvin Appel, editor, Systems & Forecasts newsletter
4. TED spread
This is a complex but telling signpost. When banks borrow from each other, the interest charged on short-term loans (three-month London Inter-bank Offered Rate, or Libor) usually isn't much greater than three-month U.S. Treasury bills, which are considered essentially risk-free
The TED spread narrowed to below 1 percentage point recently, but has since widened sharply. For financial-market stability, Merrill's Bostjancic wrote in a recent report, there needs to be a more normalized 0.35-0.40 percentage-point spread.
5. Two-year Treasurys versus fed funds
The two-year Treasury yield at around 2.2% is now on par with fed funds -- vastly improved from a yawning 1.65 percentage-point gap in mid-March.
"This is probably the best indicator in predicting better times ahead," Bostjancic noted.
Still, the needle should point into positive territory to verify a turnaround, she said. The two-year yield needs to be about 0.20 percentage points above fed funds, Bostjancic noted, "before we can say conditions are normal."
