Today's Update:  We will remain Neutral.

Why:  Yesterday afternoon was the definition of listless trading, and it's something that should be a frequent occurrence over the next two weeks.  The S&P managed to hold above that 1065ish area, but not so this morning, as the selling continued during the morning hours.  Our short-term indicators didn't react much to the decline, and remain mostly neutral, with a smattering of minor oversold conditions.  There was an unusually large drop in the put/call ratios, which automatically triggers the assumption that traders are trying to buy the dip.  However, more than half a million call options were traded on Activision (ATVI) yesterday, which greatly skewed the put/call ratios.  If not for that single stock, the Equity-Only Put/Call Ratio would have gone from the reported 0.39 (suggesting extreme optimism on the part of traders) to 0.58 (not suggesting anything in particular).  I'm not a fan of making excuses for indicators, but this is one of those times to make an exception because it was so wildly slanted by that one issue.  As I've mentioned several times, as long as the S&P managed to hold above 1065, I'd have a modest bullish bias due to seasonality and some lingering oversold conditions, but conviction was not high, and a move below leaves me with no interest in long exposure.  That remains the case.

Current S&P futures:  -8 points at 1058

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Sentiment ():  Mostly neutral

Trend ():  Stuck in a trading range

Support/Resistance ():  1065/1100

Other ():  Modest positive bias following August option expiration

Today's Update:  We will remain Neutral.

Why:  In late May, we looked at quite a few  bullish intermediate-term studies - we got a major surge in pessimism, then several positive breadth thrusts and positive price performance, all in the context of an ongoing bull market.  But after just a brief respite, June 4th's Payroll Report kneecapped the rally attempt and took us to a new closing low.  In the process, we saw very oversold conditions and some give-up among Rydex traders and individual investors.  In early July, we saw even more evidence of excessive pessimism.  The big missing piece, though, was the price action - the S&P was making a clear series of lower highs and lower lows, which muddled the risk/reward of stepping in and buying into those pessimistic conditions.  The market has obviously recovered well from there, and with the advance/decline line making a new all-time high, things were looking brighter for stocks.  But August 11th's knock-down gave us the potential for a failed break of important resistance, and we're back to being stuck in a longer-term trading range.

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Sentiment ():  Mostly neutral

Trend ():  Mixed int-term trend

Support/Resistance ():  1040/1140