Although the market has shown weakness in the past two weeks, the bears have been burned every time they press. We saw it again today as the market went straight down for the first hour of trading but slowly bounced back. The selling never seems to gain momentum, but it will be interesting to see how it closes today. If the market rolls over, that would be a change in character.
The bears have not had much luck producing sustained downside momentum recently, and the bulls look tired as well. We see good bounces, and squeezed quite nicely Tuesday, but the action isn't breaking out and running.
The lack of quality leadership is the main problem. The result of feeble bears and weak bulls is a tight trading range. That isn't a bad thing because it will help set up the next market move, but it doesn't prevent aggressive moves unless you are a gambler.
Disciplined traders usually wait for signs that a move is starting before jumping in, which usually means taking out key support or resistance levels. When in a trading range, those levels are more pronounced, which results in stronger moves when they are breached. I'd like to see a breach to the downside just to shake things up, but the market is walking slowly back up and is right in the middle of the trading range again. That is causing a little squeeze, but the action is still slow, which prevents chasing.