The stock market, and representative exchange-traded funds, technically seem set up for consolidation. At the same time, we're keeping our powder ready for a fourth-quarter spurt.

Overall, the market is receiving second-quarter earnings reports very well. Yes, the bar has been set low and is easy for companies to jump over, but looking at revenues and margins, one gets a sense of an improving corporate earnings environment.

But most important is the companies’ stock reaction to those earnings ... which has been strong. The 8% drawdown from the mid-June market high is now a distant memory.

However, I don’t think the odds are great that the markets will make a dramatic, significant push higher. At least for the time being, that is. I could be wrong, of course. But it appears from a technical perspective that a consolidation of this move is near.
That's likely to be followed by another short (emphasize short) drawdown.

But after that, I'm looking for some fourth-quarter upside fireworks.