Nothing happened last week in the market.

The S&P 500 was at 4137 when the opening bell rang on Monday morning. It was at 4133 when the closing bell rang on Friday.

That’s a 0.1% decline over five days. That’s nothing.

And it’s frustrating bullish and bearish traders alike.

In other words, the market is doing what it likes to do best… It’s creating pain for as many participants as possible.

For the very short term, though, it looks to me like the market is going to inflict more pain on the bears this week.

Let me explain…

They say you should never short a dull market. The past week has been about as dull as any non-holiday week I can recall.

So, traders should be careful on the short side.

As much as I lean in that direction for the intermediate- and long-term time frames, there’s a lot of energy building. And it looks to me like the S&P 500 is gearing up to make one last big push higher.

Take a look at this chart…

The index has broken out to the upside of a large consolidating triangle pattern (blue dotted lines). It’s a tenuous breakout so far.

It could easily fail if the S&P declines this week back inside the triangle.

But, the choppy, go-nowhere action we saw last week leans bullish.

It allowed the market to work off some overbought technical conditions. It pushed investor sentiment (a contrary indicator) further into bearish territory. And, it built up energy to fuel another push higher.

If the S&P can close above the February high near 4180 (bottom red dotted line), it could make a run towards the next resistance level near 4300 (top red dotted line).

That would cause enough pain to force bearish traders out of short positions. And it would convince reluctant bulls to get back into the market – just as we head into the six worst months of the year for stocks.

I’m not saying to bet everything you have on the market moving higher this week…

But it’s probably a mistake to be too aggressive on the short side – at least until the S&P drops back into the consolidating triangle pattern – thereby negating the upside breakout.

As bearish as I am on the intermediate- and longer-term potential for the stock market, it looks to me like the odds favor the bulls this week.

Best regards and good trading,

Jeff Clark

Source: Jeff Clark Trader