It was very easy for many technical commentators on Tuesday to declare that the morning breakout reversing lower into the late-afternoon was some type of sign from the market that it wanted to roll back over. However, as we discussed that very day, the gist of the price action for the better part of a week had been consolidation. And that, indeed, trumped any bearish hunch. While exuding patience has been an important part of my strategy since April, I have consciously avoided fighting the tape as it carved out higher highs and higher lows since the June 4th bottom at 1266 on the S&P 500 index.

Today, we are seeing a nice move out of the consolidation you can see on the 30-minute SPY chart below. There is practically never a time when I will simply plunge all-in 100% long at the drop of a hat. However, price action continues to improve even if sentiment and macroeconomic data are dour. Accordingly, I am respecting what matters most to me as a stock trader: The action in stocks.

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