The past couple of weeks have been a period of give-and-take but Friday broke the mold by marking a second day of gains for many of the indices (four for the Russell 2000). More importantly, it took markets above resistance and into a position where they can mount a challenge of June highs.

Tuesday delivered another shift with sellers coming back, although not to the same extent as Monday's buying. The net result was to leave trading ranges in key markets. Until there is a break we won't know where the nest move will come but it will keep people on the sidelines until there is a resolution.

In yet another turnaround for markets, today started with a large gap down which had the makings of a sizable bearish sell-off - only for bulls to start buying from the open and to continue to do so throughout the day.  Better still, today's surge undid much of the damage done Friday. For the S&P, the action over the last six days has much in common with the scrappy action around the 200-day MA in March/April. The only thing I don't like about this action is the frequency of the tests of the 200-day MA; the more frequent the tests the greater the chance for a break. A move above the 20-day MA should be enough to confirm a new swing low and deliver a challenge on resistance of the June swing high; riskreward measured on a loss of 2,690.  There was even an uptick in relative strength against the Russell 2000.

Friday's action didn't bring about the bounce I would have liked after Thursday's picture-perfect defenses of lead moving averages or support. The S&P closed with a bearish black candlestick on a spike high above the 50-day MA. Volume climbed in accumulation as On-Balance-Volume triggered a 'buy' signal. I would see this as a bearish close and would look for downside Monday; potentially playing for a test of the 200-day MA