Once again it feels like another shake-out, with the smart guys buying stocks on weakness. There is a fair amount of legitimate anxiety ahead of a large slate of earnings releases this week, although it seems big misses would have already been pre-announced. Nevertheless, each earnings season has its fair share of bombs held until reporting day.

If this newfound upward bias holds, we could see a strong finish to the session and that would say a lot about the risk-reward of the market.

Obviously, companies that miss will see their underlying shares hammered, but with lots of bad news baked-in lately (particularly with the high-flyers), beats could be greeted with gargantuan upside with gap openings.

One thing is for sure: this week has a big chance at setting the tone until the next jobs report.

In the meantime, the NASDAQ is meandering in between its 50- and 200-day moving averages, which signals uncertainty. The good sign from a technical point of view is that the index  is bouncing off a double bottom, last hitting 4,000 on February 3, then turning around to rally to a fresh new high.

On the upside, a close above 4,200 could spark a monster move higher. Conversely, the inability to hold 4,000 means there is little support for two hundred points.

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