'Hilly terrain' describes S&P's fluctuating behavior within the same range it's been swinging in, while Friday indeed sold-off on the favorable Bank reports, then recovered partially later in the day as suspected likely. Nothing changed.

And with the continuation of the trading range, with decent underlying breadth ongoing, that helps the S&P and NDX being poised to firm into Expiration next week. At least that's a prospect, even as the big-caps sure are over-extended.

This was a week with decent inflation data; worries in the FOMC Minutes of recession (which should temper the Fed's inflation-fighting zeal); and earnings from the Banks were better than the Street expected (gee; big deposit inflows) and .. well it's a bullish narrative short-term, while the major remain negative.

Peaking interest rates is most important to markets; even if some of that now is discounted by the projected Spring firmness (I sort of say rally; but neutral on it in a strategy sense). A lot of sectors have improved after lagging; and of course the S&P itself remains at a high level from a multiple valuation sense.

In sum: the Fed will pullback from their delayed then accelerating hiking pace and this isn't only about whether the Fed will tolerate softer economics just to fight inflation. That may take a different tack 'if' they not just see progress from their (hubris-based) hikes; but because Oil prices are high enough to prevent a significant easing of prices; and they need to get a grip on recognizing that.

We did get some hawkish comments from a couple of the Fed guys; but we also had unusual University of Michigan 'consumer sentiment' surveys, that suggest most people expecting better economic conditions and more inflation.

So that doesn't sync well, and might be reversed in the next survey; however to my thinking, unless the Fed really wants to kill the economy, they really do need to sober up, and recognize that with Defense and Energy spending; plus climate change keeping food costs somewhat high, along with 'infrastructure' spending barely getting going from the previously-approved plans; well how do you really get prices back down. You don't. You just slow inflation's 'pace'.

Commercial real estate remains at the top of the domestic list of concerns. It's debatable; but a number of loans and lessees are coming up. Hopefully not at a level that would be disruptive to lenders; but it could be. Mortgage-backed bonds are involved, and that is possibly an 'Achilles heel' for both sides.

Meanwhile deposits at small banks was up 23 Billion this past week; which is possibly more important to avoiding a 'crisis mentality' returning in banking. Of course there are variables in all these areas; and then there's geopolitics too.

Bottom line: market fade after upside 'S&P chart channel' overrun Friday. Of course there's a drag from a couple stocks like Boeing and United Health; at the same time as some small-caps are being embraced by 'day-traders', like BBAI in particular. That's fine. Next week gets more interesting; April is not a Quarterly, but there's lots of Calls that were written for this Expiration. Hard to be specific, but that could contribute to yet-more upside into mid-week ahead.

More By This Author:

Market Briefing For Friday, Apr. 14
Market Briefing For Thursday, Apr. 13
Market Briefing For Monday, Apr. 10