While I remain cautious, I've been able to avail myself of some good trading opportunities. Just because I think the indices are extended doesn't mean that I can't take advantage of opportunities and trends that are present. For example, oil-related stocks followed through, and the metals, particularly gold stocks, perked up and look to be offering some excellent opportunities for those willing to take them.

The S&P and the Dow look to be walking the high wire, while the Nasdaq and the Russell 2000 have been consolidating nicely and may be ripe for a breakout move to the upside. This would make sense, as many of the mega-caps remain extended and in much need of a rest. A rotation out of the big boys and into other less-extended areas, like small-caps, would not be a surprise.

With the bulls in full-blown rally mode, any bearish arguments are merely academic. At this point, the trend higher is firmly in place, and it is silly to fight it too hard. However, at some point, the negative arguments will matter. Comments that seem silly now will dominate the headlines as we daydream about the good old days, when we counted how far above 12,000 the Dow was.

At some point, the Dow and S&P will falter, and I'll be watching closely to see how the negativity manifests itself. Sometimes the negativity envelops everything, and other times, great pockets of bullish action persist. Time will tell, but for now, I'll continue to play what is in front of us, keeping my time frames short and leashes tight.

Let's go to the charts.

The Nasdaq added a few points Wednesday on a slight uptick in volume. The sideways action here has been a start, but I'd prefer to see this continue for a few more days. I'm watching support and resistance levels closely.

The S&P inched higher Wednesday on average volume and continues to look very extended and in need of consolidation. I will keep my caution level high until I see some basing action in this average.

Small-caps, as represented by the iShares Russell 2000 (IWM - commentary - Cramer's Take), outperformed Wednesday on a volume surge. The Russell didn't break out above the current pivot, but still looks much more attractive than the other averages. If this relative strength can continue, I suspect there may be some very solid trading opportunities under the surface.

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Yesterday, I posted a chart of Schlumberger (SLB - commentary - Cramer's Take) to illustrate the bottoming action that was taking place in the oil sector. Schlumberger did what a stock that is bottoming is supposed to do and broke the downtrend line on heavy volume. That bodes well for future price appreciation.

As I mentioned earlier, as the mega-cap stocks become more extended, many small-cap stocks have been consolidating and are offering some very attractive setups. Perficient (PRFT - commentary - Cramer's Take) is one such chart that I would consider if small-caps begin to show increased relative strength.