Finding Peace in Summer

Today's pullback in stocks comes within the context of a larger sideways move on the major indices dating back a week or two.

The IWM, ETF for the small caps housed in the Russell 2000 Index, for example, is still working through a very well-defined range dating back nearly two weeks now. 

On the hourly IWM chart, below, we can see attempts to break $120.60 to the upside have been blunted by sellers of late. Still, this is hardly an aggressive downside rejection yet, let alone a breakdown. In fact, the small caps may be finding peace, or balance, at the $120 level and coming to terms with it well. And, once again, bears are going to need to do better than this to reverse the bulls' progress since Brexit. 

Oil remains a wildcard, to be sure. But as long as bulls find rotation beneficiaries and new leaders they deserve the benefit of the doubt. Specifically, AAPL is weakening again today in front of earnings tomorrow. The AAPL chart has been in a clear downtrend for over a year now. And much like CMG NFLX, the market may be giving a variation of "out with the old, in with the new" leadership--A variation, since AMZN FB remain very strong and are still leaders.