So the S&P 500 got through the 1200 resistance level. But did you notice that the Nasdaq Composite essentially got back to where it was early last week? And the Russell 2000 is also back to last Monday's levels.

However, the most interesting development for me is that the breadth finally got moving. The majority of my indicators are calculated using various breadth measures, and if breadth stinks and can't string together a few days of positive readings, my indicators can't lift. Monday's strong breadth reading has pushed some of the indicators upward.

Now before I sing the praises of the rally, allow me to point out what wasn't good. Despite Monday's good readings, overall breadth has lagged. It needs to catch up.

Another thing that wasn't good -- on a short-term basis -- was the action in the Bank Index. It got to just shy of 100 and backed off. While that is to be expected, note that it closed on the low of the day.

I've been constructive on this group for weeks now, and with the Federal Open Market Committee meeting later Tuesday as well as Monday's action -- and the fact that I seem to have gathered way too much company for my taste -- I would say a pullback is in order. In fact, a pullback in this group would make it better, as it's now quite overextended and needs a good shakeout.

However, the chart that really caught my eye is the Philadelphia Semiconductor Index (SOX). I'd thought it would come down to the 430-440 area. It did, and it bounced from there. But it couldn't sustain that bounce, and last week it cratered. It's entirely possible we'll see it struggle Tuesday with the Dell ( DELL) news after hours, which would contribute to the scenario I suspect could develop.

I find myself looking at this chart and wondering if that move late last week is going to turn out to be a sort of island-reversal pattern. Recently I've written about several island reversals, but all have been at highs, or tops, such as the island reversal in Phelps Dodge ( PD). There haven't been many opportunities for us to see potential island reversals at lows. Until now.

For now, this is only a possibility, as we need to see that the move Friday remains "by itself" like an island, surrounded with no trading on either side. But I would also point out that Analog Devices ( ADI) hasn't yet made a lower low and for the past year or so, we have seen this stock lead the semiconductor index.

I continue to believe we will see ups and downs this week in the market as a whole.

Overbought/Oversold Oscillators

For more explanation of these indicators, check out The Chartist's primer .

Helene Meisler writes a technical analysis column on the U.S. equity markets and updates her charts daily. Meisler trained at several Wall Street firms, including Goldman Sachs and SG Cowen, and has worked with the equity trading department at Cargill. At time of publication, she held no positions in any securities mentioned in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. She appreciates your feedback; click here to send her an email.

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