Most Fridays are a little more enjoyable than other weekdays because the weekend is right around the corner. This particular Friday, however, was a welcome event just because we can now mentally close the books on an uninspired week, put a terrible month (for stocks) in the rear-view mirror, and put a poor start to the new year behind us. All told, the S&P 500 lost around 3.5% in January. That's the worst monthly performance since August of last year, and the worst January since 2010. Yikes. Advertisement Today's Top 10 Small Cap Stocks - Dynamically Updated List This list will continuously scan and rank small cap stocks throughout the trading day. Find realtime trading opportunities using our SmartScan and Trade Triangle technology to uncover the next big stock under $10 to make major moves. View the top 10 small cap stocks for today. Advertisement If this month's bottom line has you worried about the so-called January effect - the idea that a bullish January is a prelude to a bullish year and a bearish January is an omen of a bearish year - you're not alone. Though I'm only a half-hearted fan of the premise, we'll still take a look at the reality of the January effect below. If you're on pins and needles about the January effect though, here's a quick appetizer... I'm not worried about 2014. The first thing we need to do for you today, however, is wrap up this week's market action and explain what it means to you. Getting Nestled In Actually, there's not a lot to say here. There are just a few things I need to show you, mainly to underscore how the S&P 500 remains trapped in a tight range. Until the index actually wiggles out of those confines, I don't see stocks going anywhere worth worrying about. Here's the deal - the S&P 500 is trapped between 1773 and 1794. Those lines were the floor and the ceiling all week long. While both sides of the box we're now stuck in were put to the test a couple of different times this week, they each passed their tests. You know what though? I'm still more bearish than bullish, and I think it's only a matter of time before the sellers knock the S&P 500 under a HUGE support level around 1773. If you want to know why, it's simple. Check out today's volume. This is a story we've been following all week long, and it played out again today. Yesterday's mild bullish volume was topped by today's higher bearish volume. Tuesday's bullish volume was weak too, and it was surrounded by noticeably higher bearish volume on Monday and Wednesday. Point being, the clues say there are more buyers than sellers here, even if the sellers didn't make any net progress this week . I also find it interesting how the VIX was pushing higher like it was to end the week. It's a hint that even though stocks aren't necessarily acting bearish, traders are positioning bearishly behind the scenes. And, even if the S&P 500 does manage to crack the ceiling at 1794, there's still a big hurdle waiting for it at 1813. Putting it all together, I just think it says we've got more working against the market than for it. We'll be back at it on Monday, waiting for that breakdown, and then looking at downside target levels when it makes sense to do so. January Effect? Meh. But what about the bigger, full-year picture now that we've booked a sizeable January loss? Don't sweat it. Here's why. While I'll be the first admit the correlation between a bullish January and a bullish year is impressive at 89%, I'll also remind you that the market is designed to go up. Being impressed by a market that goes higher in January as well as over the course of the same full-year is like being impressed that the sun came up on a certain day - that's just the way things work. But 2014's January was bearish. What's the correlation between a January loss and a loss for the whole year? About 50%, meaning only half the bearish Januarys we've seen in recent history have preceded bearish years. The other half of those bearish Januarys led to bullish years. Now, that may be enough of a reason to be concerned, though I still question the cause and effect, and I still contend it's more of a coincidence than a cause; if we're in a bear market, January as well as the full calendar year are both probably going to look bearish.... but we're not in a bear market. Point being, we're not going to stay out of the market just because of January's results. With all of that being said, a big part of the reason I'm staying on the bullish side of the fence for 2014 is based on earnings, which are still strong. Yeah, there have been a few warnings with Q4's results, but when you take a step back and look at the bigger picture, the problems are based on errant expectations rather than growth. Fourth quarter's earnings growth is still right around 6% on a year over year basis, and 2014's earnings growth is still expected to be around 12%. Barring any major economic disruptions this year (and I don't see any on the horizon, here in the shadow of two consecutive great GDP growth readings), corporations should be able to reach that target growth rate with only a modest effort. Congratulations! In some ways I'm jealous. In other ways I'm amazed. More than anything though, I'm just happy at least a few of you were able to score a huge 20%+ gain today. That's how much yesterday's pick from the SmallCap Network Elite Opportunity jumped on Friday. And just so there's no confusion, the SCN EO picked this stock yesterday around mid-day, getting in well before the close on Thursday. All of the service's subscribers got the buy notice around noon EST yesterday, so it wasn't like John Monroe just happened to catch a rising star after-hours when it was already up big-time. I debated whether or not we should tell you what the pick was/is, but I decided not to, since the SmallCap Network Elite Opportunity is still in the trade. You may be able to figure out what the stock is (which is fine), but even if you do, so what? There's no point in chasing it now. Besides, it's possible the SCN EO will be getting out of it pretty soon. We'll just have to wait and see. While it's too late to jump on yesterday's 20% winner, let's face it... this is more than a matter of luck. Monroe and his guys have a habit of finding big movers, and though yesterday's pick admittedly moved faster than most, it's not one bit surprising that the SmallCap Network Elite Opportunity found such a trade. So how about it? Are you jealous enough to go ahead and at least take the free two-week test-drive to see for yourself how great the SCN EO is? Here's how, or cut and paste this link: https://www.smallcapnetwork.com/pages/SCNEO/v1/ By the way, I know for sure we'll have at least one new trading idea for you next week.