Back in April, I wrote several articles talking about the sentiment indicators toward the overall market and how they were too optimistic.

After six straight weeks of losses for the S&P, we are starting to see the sentiment indicators shift to a more cautious stance.

The Investors Intelligence report saw the bullish percentage hit a high of 57 percent back in April and has now dropped to 41 percent.

Looking at the ratio of bulls to bears, the ratio was at 3.65 back in April and is now at 1.81. When the market bottomed in July 2010, the ratio was down to 0.8.

The CBOE Volatility Index (VIX) dropped as low as 14.30 back in April. Over the past four years, drops below the 16 level haven't been a good sign for the market.

The VIX has bounced back up above the 19 level, but the index jumped above 40 last summer before the selling stopped.

Seeing some of the optimism get washed out of the market during the six weeks of selling is a good thing. Too much optimism leads to down cycles and this has been an orderly one. When optimism is too high and stays high, we tend to get the meltdowns rather than systematic corrections.

We may have a little more selling to go at this point, but the market is looking more attractive now than it has for some time now.