As economic and earnings reports taper off, the coming week could serve as a key gauge of market sentiment.

"The key will be to see if the momentum continues. There have been a lot of traders chasing new highs and strong stocks. I'm very curious to see how much longer that can continue without a decent rest," said RealMoney.com contributor James DePorre. "We need a pullback, and I hope we get it."

The market has advanced steadily since the fall of Baghdad, with all three major market indices posting double-digit percentage gains. But while stock prices have improved, the economic picture really hasn't -- consumer sentiment is still weak, weekly jobless claims continue to hover above 400,000, and some corporate earnings have been tepid.

Over the last seven days, stocks continued to rise, but with far less conviction than in previous weeks. The Dow Jones Industrial Average finished the week up less than 1%, while the Nasdaq and S&P 500 rose about 1.2%.

As for sectors that might be due for a retreat, DePorre singled out the ones that have rallied despite the fact they've shown no major fundamental improvement. Specifically, DePorre pointed to the biotechnology sector, where speculation is quite high, with a combination of short-covering and low share prices making for volatile trading.

In his eyes, speculative plays like biotechs are a good indicator of investor sentiment, with people optimistically buying into corporate stories that aren't backed by real numbers.

"I think there is a good argument that we are seeing a gradual change in character of the market," said DePorre. "There is a lot of cash on the sidelines, not in mutual funds but in money market accounts and banks. If the average guy really is gaining some confidence, I see the funds slowly coming back into the market and giving us some support."

A few retail names are set to report results this week, with the biggest report coming Tuesday from blue-chip hardware chain Home Depot ( HD). That same day, fellow blue-chip Hewlett-Packard ( HPQ) reports after the bell.

Lowe's ( LOW), Toys 'R' Us ( TOY) and Nordstrom ( JWN) report results on Monday.

Tuesday features Saks ( SKS) and Staples ( SPLS), followed by Gap ( GPS) on Thursday.

On the economic front, the biggest release will be the weekly jobless claims for May 16, which are expected to come in at 435,000, a bump up from the 417,000 recorded during the week of May 9. If claims come below 400,000, it would be an extremely bullish signal, marking the first dip below that mark in nearly three months. Also on the economic front, the leading economic indicators for April will be released on Monday.