The type of basically shallow backing and filling that the market has seen off the two-week snapback rally from correction lows has spilled over into this morning’s session. Apple gapped lower but has V-shaped much higher since. I am seeing some decent breakout setups, but following-through to the upside and holding those moves is key to avoiding more of the recent choppy action that has frustrated bulls and bears alike. Apart from Apple, the market has largely resisted an aggressive move for downside price discovery to form a higher low. And that can be seen as a positive for bulls.

However, the longer that the 1420′s on the S&P 500 Index acts as resistance the more reticent I become to embrace the bull case. Thus, a breakout should happen sooner than later at this point. That said, with technology and cyclicals leading today it should give bulls the ammunition they need to sustain a move. Furthermore, the emerging markets continue to press higher and are threatening a weekly breakout in their own right.

The semiconductors and small caps were two keys of the week I highlighted last weekend for 12631 and Weekly Strategy Session members. Their performance this morning continues to point to bulls who may be flirting with red, but sure are resilient and not giving it up so easily.