The market had hung around the top of the range over 2110 for quite some time. Breakout number one was a move over 2119, and after some time 2134 became there new level. We have a double, consecutive-day top at that level and after several tries that failed decently below, the market gave it up some. Nothing terrible, but we're now headed south for the most part as the market unwinds further its oscillators, which were not overbought, so they're getting down to some nice levels, if you're a bull. The lower the better.

Each and every morning it seems we wake up to some poor action overseas, which then takes our-market futures down with it. Nothing bad but lower. Once trading opens up, and after the normal few attempts to go higher, we seem to sell off some, and then head downward for the most part the rest of the day. Hopefully, this action is getting on the nerves on those relentless bulls, which will, thus, allow for some froth unwinding. I would like to see that more than anything else. Some pessimism would be a good thing. Not just moving towards agnostic, but down right bearish would be a great dose of medicine for this market.

Still, there's not nearly enough bears when researching the bull-bear spread. We have definitely seen a drop in bullish traders, but they've only moved towards agnostic. Few are turning truly bearish, and that's what ultimately needs to change. We are moving in that direction, but, for now, as far as the market price-action is concerned, all we're really doing is moving back and forth, going nowhere. Mindless meandering, my favorite expression. No sign of that stopping any time soon. Adapt or get caught up emotionally, and pay the price with your wallet for over playing. All playing should clearly be on the very light side of the ledger.

The transports continue to act the worst, while the banks and financial's are acting the best. The financial's are due to the anticipated rate hike(s) to come. The transports have been lagging, and are precariously close to breaking into full-bear mode. We will have to keep a very keen eye on the price behavior there over the coming days and weeks. Most sectors are taking just the normal hit that comes with selling off the top, such as we've seen over the past few weeks overall. Nothing devastating to this point, but we all know there are tremendous risks out there from froth to bad weekly and monthly charts, so we never take an eye off the ball. Risk isn't going away sadly, if you're a bull.

We can hope that the market continues to ignore the bad that's out there, but the truth is we're dealing with a lot of major-risk factors, thus, things can come tumbling down very hard at any time without a single excuse from Europe, or any other outside influence. For the most part, however, we are still seeing enough rotation all throughout the market to keep the selling days from getting completely out of hand. For now, the market is finding money flow to keep it from getting bad, but that doesn't we're selling overall.

For the bears it's all about getting the market below 2040. For the bulls it's all about getting back above 2134. If the market closes decently below 2040 on the S&P 500, things will turn more bearish, and I'll explain why. A few months back we had intraday lows at 2042, 2041, and once again, 2041. We now also have the 200-day exponential-moving average at exactly 2040. You can see the massive support on horizontal price, and on the moving average between 2040 and 2042. If the market were to blast well below, say by at least half a percent, if not a bit more, the pressure will increase on the bulls to do something fast. The bears will feel much braver having taken away such key support.

It was no different at the top as it would now be at 2040. For now, the range is defined very clearly. 2040 and 2134. A large five-percent range. Everything in between 2040 and 2134 is noise, and meaningless noise at that. The daily charts are starting to unwind their oscillators very nicely. That's good to see. If we ever get near 2040, things would be oversold on the daily-index charts. Getting the market to break down at oversold isn't going to be an easy task for the bears. For now, we watch price and let it dictate how we proceed. But things may get interesting soon, if we can get a bit more oversold. For now, we keep it light and under control emotionally.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.

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