Consider the latest readings of the Hulbert Stock Newsletter Sentiment Index (HSNSI), which reflects the average recommended stock market exposure among a subset of several dozen short-term market timing newsletters tracked by the Hulbert Financial Digest. At minus 22.5%, the HSNSI is even lower than it was at the beginning of last week, when I had already concluded that the market was close to a bottom.

In fact, the HSNSI is now lower than it has been since October 2005, some two and one-half years ago. This is a big contrast to the sentiment situation that existed at the Jan. 22 market low, when the editor of the average market-timing newsletter wasn't even as bearish as he was during the market's corrections of last summer and fall.

Technical support for the idea that the correction's bottom has been seen comes from the market's diminished trading volume in recent weeks. Bob Brinker, editor of Bob Brinker's Marketimer, the newsletter with one of the best market-timing records over the last two decades, explained why in the March issue of his newsletter, published earlier this month:

"The process of establishing a stock market correction bottom has unfolded in text-book fashion over the past two months. This process involves the establishment of an initial closing low, followed by a short-term rally, followed by testing of the area of the prior established closing low on reduced trading volume ... The correction bottoming process (over the past few weeks) has seen a significant reduction in selling pressure in the vicinity of the Jan. 22 closing low. This is a very important aspect of any successful test."

Pretty good story. Make sure to read the whole thing. Is it overly optimistic? Not sure. Let's hope not.