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S&P 500's Bull Flag Breakout Failure Doesn't Spell Disaster Yet

"A lot of people get so enmeshed in the markets that they lose their perspective. Working longer does not necessarily equate with working smarter. In fact, sometimes is the other way around." -- Martin Schwartz, in Pit Bull

NEW YORK (TheStreet) -- Today we saw another slow day for markets, as traders trickle back after a long weekend. It was a definite rest day for markets and stocks -- and even a bit of weakness -- but not anything that is showing a breakdown yet.

The leading stocks subscribers and I are in are just setting up continuation patterns which should take the stocks higher any day now. Markets also remain poised for higher prices, although at a slower pace than the stocks I'm in.

Read More: Why Prospect Capital's 12.6% Yield Is a Great Deal in a Stalling Rate Environment

Buying dips still works -- especially at the lower level of patterns, such as bull flags, and especially in the right stocks.

While it would be nice to see the S&P 500 SPDR ETF (SPY) really break out of this bull flag on heavy volume, it is not yet to be.

Read More: Chipotle's Monty Moran Unwraps the Restaurant's Success Story

We've got to keep an eye on things. But as long as we remain above $199.40, we should be good.

I know a lot of people are still calling for corrections. But they have been saying the same thing for the past two years, which incidentally have been spectacular.

At the time of publication, the author held no positions in any of the stocks mentioned.

Follow @iTraderz

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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