Some Volatility Entering Back Into the Market

Indecision seems to be plaguing the markets as price is see-sawing of late. The average daily range has increased and there are some similarities to what we saw in January right before the markets sold off. Although S&P 500 Futures moved back up to test previous highs after the dust settled on the SEC's Goldman accusations, there are signs of weakness as new highs could not be achieved. On top of that, there is increasing uncertainty over the Greece situation. The Euro sold off and the dollar gained in overnight trading and S&P Futures fell almost 12 points as a result. With bullish sentiment high and the VIX at historically low levels, a correction could be looming on the horizon.

Economic news has not been much of a catalyst for the markets lately, but watch how the markets respond this morning to the PPI, jobless claims and existing home sales data. A close today below Monday's low of 1179.75 would be the first real confirmation of a potentially weakening market. If the markets sell off but find buyers at 1180, watch out for a possible topping range between 1180 and 1210.