Quiet Day of Consolidation

Ironically after 6-7 sessions, many of which had substantial "gap ups" to begin the day, the now famous Monday morning gap up was not to be found.  Not that surprising considering how ferocious the rally has been the past week and a half; news reports indicated last week was the best for markets since July 2010.  News flow is light other than some secondary economic reports and a deal between EBay (EBAY) and GSI Commerce (GSIC) - but frankly this market has been rallying tremendously with or without news of late. 

With the S&P 500 back over the 50 day moving average and the lagging NASDAQ also joining the fray, one definitely has to be back to a market neutral and/or bullish outlook.  While I cautioned we were due for an oversold bounce a week ago Thursday - the strength of this move certainly was far more than I thought, considering the deteriorated technical condition of the indexes and a breakdown by quite a few of 2010's leaders.  As always, we can work off a big move via time (going sideways and consolidating) or price (pulling back).  For the past 2 years it has been mostly time.   Intermediate term I still want to see a new 'higher high' in the index before calling the all clear - i.e. S&P 1330.

Later in the week the news flow picks up  - keep in mind Friday is labor reports day, along with one of the ISM reports.