The Nasdaq Composite, S&P 500, and Dow Jones Industrial Average all closed below their 50-day moving average on Tuesday. In addition, more than 85% of stocks within the S&P 500 are currently trading below their own 50-day moving average, according to Dwyer’s note to clients on Wednesday.

Despite these technical signals, Dwyer cautions against confidently buying the dip. He explains, “The fact that the market is oversold does not mean the correction is over. It simply indicates that the conditions are favorable for a temporary bounce, similar to what we saw in mid-August. This is especially true considering that the average NYSE stock is already down 30% from its 52-week high.”

Dwyer also points out that the recent increase in bond yields will limit any short-term rebound. He states, “Ultimately, for a more sustainable rally to occur, there needs to be a significant and consistent decrease in U.S. Treasury, mortgage, and corporate bond yields.”

The benchmark 10-year Treasury yield slightly retreated from its 15-year high on Wednesday morning but still remained above 4.5%. Additional reporting by ‘s Michael Bloom.