The CBOE Volatility Index (VIX) had been in a downtrend for a year and a half, with the trend line being connected by the high in June 2012 and the high from last October.

The trend line is resting right around the 20 level and during Monday's big selloff, the indicator jumped to 21.48. The fear gauge hasn't been above the 21.50 level since last June.

With the VIX breaking its downtrend and the S&P 500 breaking below its 13-week moving average, I see the market having even more volatility in the coming weeks.

I can see the S&P 500 falling to the 1,710 level or perhaps even dropping to its 52-week moving average, which is presently at 1,681.

The other sentiment indicators have definitely shifted off of the bullish extremes we saw back in December, but we still haven't seen a great deal of volume during the selloff.

I feel that we need to see a spike in the trading volume before we reach a capitulation point and see the market reverse the current downswing.

Coming off the extremely low trading volume around the Christmas and New Year holidays, the volume has been trending higher, but we haven't seen a big one day spike or even a spike in the weekly volume.