On October 28, the S&P 500 index traded almost double its daily average volume for 1997. If you refer to a six-month index volume chart of the index for the period between July 1997 and February 1998 (apply a one-day volume moving average (VMA)), you will see the huge volume surge that occurred. This signifies that in the panic that took place, a vast number of low priced shares were being transferred from one group of investors to another. The market became extremely oversold. An exceedingly bearish market sentiment (in this particular case - two days of extremely low A/D ratios readings a short time apart) coupled with a high-volume sell-off: this is a perfect indication of a market that was exceptionally oversold and thus primed for a long-term reversal to the upside. In fact, the day after the October 27, 1997 low, the S&P 500 rallied by more than 4%. Within less than 2 months, the index had recovered by 12%, and by June 1998, the index had gained over 30%. October 27, 1997 is a date worth mentioning for another reason: in the almost 8 years since then (as of the writing of this article), the market has not even come close to matching the exceptionally low AD issues and volume ratios seen on that date.