Markets began the week Monday with modest gains as the Nasdaq rose .3% and the S&P 500 by .2%. The Nasdaq is looking for a fourth consecutive weekly gain and has formed a bullish flag formation with very taut trade the last 7 sessions. That is solid technical action following a huge V shaped recovery, which traditionally is not. The index is now trading sideways with support at the round 4600 and resistance just above the 4650 handle. A move and more importantly CLOSE above the 4650 handle could be powerful. Dare I say never short a dull market, although the current 7 day sample of listless trading may be very small. The only sectors to finish in the red Monday were the material and energy groups. The XLE was turned back precisely at its 50 day SMA and is still within its bearish rising wedge pattern. The important transport group may be shedding some light on the economic recovery. The IYT hit an all time high Monday as important stocks in the sector look very strong like UPS and FDX trade at all time highs. UPS is acting just like a true leader should after taking out a cup base trigger of 105.19 exactly one week ago. It is higher 15 of the last 17 sessions and it always pays to look back on a chart to see where former areas of resistance were. For UPS the 105 level was tough to get above dating back to last New Years Eve and again in July. That move through significant resistance dating back almost a year speaks volumes. Maybe the stock are forecasting a strong holiday season. The retail group has been perking up. M and JWN will be among the names reporting in the group this week to give clues.

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