Confidence Suspect

The S&P came within a point of the 1656.78 and left it unfilled. Yet it didn't go anywhere overnight. Perhaps it only needed a rest and will blow through it today. But the fact that it needed a rest at all is pretty suspect

Here is a market that has been beaten down for a month and is still below the 50-day moving average after bouncing. Yet it's bounced less than 20 points. This is not to say that it can't go higher -- it should -- but the character of the market feels like it's changing.

The 50-day MA sits at 1663, just above the gap. Another gap is at 1685.39. Filling the higher gap would also add to the head and shoulders within a head and shoulders pattern written about over a month ago. The larger right shoulder would be created with price up around the 1685s.

The 10-year note hit a new low in price this morning and does not seem to be getting any press. Yields touched their highest levels in two years. This makes tomorrow's NFP number a much bigger deal. The odds of a September Taper are steadily growing.

The fact that the market is on edge about a taper at all, after record amounts of coordinated stimulus since 2009, is not inspiring confidence.