A Tight Range Developing

In hindsight yesterdays 1324 low was the place to get the edge. We passed because of conflicting fundamental and technical input.  The market has a bid for some reason here, however, in our opinion for a lot of reasons it does not seem to be the start of something big.  We look for  a tight 1330 to 1370 range on the S&P for the next few days.

Here are some underlying issues to keep in mind. 

1) The energy price situation and reasons behind it are a big cloud over the stock market.

2) The failure of the market to breakout over 1393 last week is another long-term cloud.

3) Volatility is low, but maybe that is to be expected as this recent market decline was just a little backoff from resistance and would not necessarily bring big volatility.  Investors are well acquainted with low volatility rallys in the stock market over the past 6 years.

8:20 AM CDT