A fierce last-minute (well, less than thirty-minute period) of bulls reflecting over gravity, the disconnect between the markets and economic engine that's still a clunker, and a likely and lowly VIX at key psychological support of 20% finally paid dividends for bears!!! Well, that's not exactly true. The bears, outside the Fast Money-types who sold the canary action in "Mr. Market" (GS), in fact are still well underwater.

Fresh recovery highs during the session and on top of the market's historic, "yada, yada, yada" lows which everyone bought, 65% to be exact in the SP-500, still infers being a bull has paid big dividends in shareholder value and maybe some quarterly gratuities to boot. In spite of the obvious helpful trend or perhaps because of that same long in the tooth situation and a "Dow 10K!" celebration which looks more like an Island Top "sell-e-bration" to this market observer, let's take a look at a couple counter-trend shorts.

After a near perfect 13, 5 and "extended 13" week run in favor of the bull, I'd like to emphasize "There's always a bear market somewhere." And maybe, just maybe-investors will find some of that under-the-surface laggardship leading the way towards bulls, one and all, to strap on additional "red chutes" into one of those healthy but usually not-so-soothing corrective market circumstances.

Figure 1: J&J (JNJ) Topping Daily

"No more tears?" I don't personally think so when perusing the tea leaves of Johnson & Johnson (JNJ). After an ambitious test of highs immediately in front of its earnings release, shares of JNJ confirmed investors' collective conviction was, after all, a double top.

In the present, well on the heels of Wednesday's market humper, three sessions of distribution have followed a gap breakdown back into the lateral consolidation. In conjunction with a Wave 5 top which appears a bit too optimistic for shares to tag, JNJ looks ripe for further correcting after its latest lateral period of digestion and a close below its 50-DMA.

Figure 2: Texas Instruments (TXN) Daily Bear

"Tech Wreck anyone?" Not me, but while my vote doesn't foresee a dot-bomb repeat, there have been a few high profile laggards leading an anticipated corrective move for Mr. Market. Qualcomm (QCOM) and Verizon (VZ) are a couple of the more obvious choices in asking, "Where's the beef?" Another and shown above in Figure 2 is Texas Instruments (TXN).

The daily pretty much speaks for itself, as a handful of distribution days have occurred within a flag or right shoulder. Those bearish developments have been held mostly in check by an overhead 50-SMA acting as resistance. The action is all the more worrisome as Texas Instruments actually put together a strong report this week.

Technically speaking, pardon the pun, the report should have pleased and pushed bulls into the laggard and broken the fore-mentioned bearish patterns. The fact investors were unable to show a convincing show of appreciation on the daily, as well as the weekly tea leaves (not shown) forging a potential W4 high, aren't thought to be good signs for TXN. All I can say is don't say the sheriff from the south didn't warn you if the bulls find themselves in a losing gunfight with those villainous bears.

Chris Tyler
Senior Staff Writer & Options Strategist
Optionetics.com ~ Your Options Education Site
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The information offered here is based upon Christopher Tyler's observations and strictly intended for educational purposes only, the use of which is the responsibility of the individual.