The S&P 500 slipped 0.5% Monday as the index continued consolidating November’s big rebound under 4,600 resistance.
The market has been stalled for a couple of weeks, but this was expected. As I wrote early last week:
Calm markets are bullish, and the path of least resistance remains higher, but I’m not excited to hold all of the risk underneath us for another few points of upside.
That means I will keep watching this develop from the sidelines after collecting big profits before the Thanksgiving break.
But if this strength persists and we are setting up for another pop through in overhead resistance, I will be happy to jump back in. But we’re not there yet.
Well, here we are a week later, and not much has changed.
Far and away, the hardest thing to do in the market is to not trade. We have opinions, and the market is always doing something, but at this stage, every trading signal fizzles and reverses hours later.
Just ask all of the bulls that bought Friday’s strength, only to watch those profits turn into losses Monday morning.
This is a consolidating market, meaning we can’t read anything into these intraday gyrations. Something will happen, but this isn’t it. Keep waiting and watching.