If the Nasdaq moves above the immediate resistance at 1606-1620 then some short-covering is taking place, but the real short-covering will not come unless prices can exceed the 1630-1636 level. The next resistance is 1655-1672.
If the S&P 500 prints above 1069-1077, some short-covering will be fueling the rise, but the real short-covering won't come unless there are prints above the next layer of resistance which is 1079-1086.
The S&P 500 has downside risk for prints at the next shelf of support which is 1020-998.
Usually, the first lift after a nasty decline is only fueled by short-covering and some momentum players, both these buying interests die out within a short amount of time (lately just 6 to 12 trading hours). It is the retracement after the first short-covering lift that can offer a better understanding of the chances for a leg to the upside.
There have been no signs of capitulation in volume or Put/Call ratios. Cherney is chief market analyst for Standard & Poor's