Today is the upteempth time the past few weeks where the market gapped up and/or started strong, only to listlessly trade during the trading session, often in negative fashion. But the action during regular normal hours is being masked by the premarket jumps. Whatever the case, the market is definitely in a consolidation sideways stage, which has been a rare situation the past 8-9 months. This sideways action should lead to a substantial move once we get going, either up or down. For bulls, we'll keep repeating the mantra of needing to clear mid S&P 1340s, to create a new high. For bears, until the new breakout higher occurs, they can lean on the potential 'double top' that has formed in the S&P 500. As a sidenote - the 13 day moving average has been an absolute bulwark since late August 2010 for the S&P 500; we continue to see that being held around 1323-1324. I would consider it to be a relatively important signpost if we see it break.
Interestingly, the Russell 2000 - more small cap heavy - which has lead the move up, has been a leader to the downside the past few sessions. But overall, all the major indexes are coming into range of the 20 day moving average.
With earnings season kicking off tonight with Alcoa (AA) perhaps this will be the catalyst to see us move out of this somewhat sleepy moment. Alcoa is not so much an event, but the large cap multinationals begin later this week, and dominate earnings the following few weeks. I expect another good earnings season versus lowball expectations, but commentary about inflation and margins in future quarters is what one should be focusing on.