The daily ranges of the major market indices have been flat and narrow over the last two months, and the sedate sideways movement translates to weekly charts that look somewhat fatigued and poised for modest pullbacks.
Using the S&P 500 for illustration, the August/July period is made up of two horizontal channel consolidations that can be drawn as a rising channel. The index has moved in a number and variety of channel consolidations for over the last year, and breakouts or breakdowns from these patterns have been good predictors of the short and/or intermediate term direction.
The RSI has moved below its 21 period average and center line on this timeframe and the MacD has made a bearish crossover and is tracking lower. These readings reflect declining positive momentum, and Chaikin money flow moved below its signal average this month and is reflecting an increase in selling pressure.
A pullback to the 2130-2110 area of support would be modest on a percentage basis and could have a recuperative effect on the broader market, but that is, of course, if it holds.