Happy Thursday, everyone. Kudos to the bulls for logging another winning day for stocks. Gotta be honest - Thursday was a minor blow to my bearish thesis, and not just because stocks made a gain. I'm still leaning bearishly, but we owe it to you to look at both sides of the coin. So... Let's just start at the beginning. On the chart of the S&P 500 below, we can see how once again the index briefly traded under the 20-day moving average line, and once again, the bulls pushed back above it. Ditto for the floor at 1990 - the S&P 500 traded below that support line for a while, but when all was said and done the bears couldn't push the market over the cliff. So what's the problem? It's still not like a break under the floor at 1990 is out of reach. For the time being, the S&P 500 is just range-bound between 1990 and 2010. Until the index can break above 2010, the odds of a meltdown are still just as good as the odds of a breakout. Even then, however, there'd still be something fishy about a break above 2010 if it were to materialize too soon. If the market's going to make another bullish leg, it's going to need to build a technical base first ... and it hasn't yet. Now, had the NASDAQ not formed the same basic chart, it might not even be worth mentioning about the S&P 500. To see the NASDAQ do the same though? Take a look. What you'll see is a push up and off of the 20-day moving average line as well as off of the floor at 4545. The big "so what" is, it would be easy to get bullish after today just based on Thursday's action. Don't take the bait. If another bullish run is in the cards, we'll know soon enough. We're not there yet though. Like we've been saying, this is still a day-to-day affair. Portfolio Update I don't know if you saw it or not, but our position in JC Penney (JCP) had a heck of day today. The stock jumped 3.3% on Thursday, widening our overall gain. Some people may suggest it was JC Penney's debt-refinancing that spurred the bullishness. That may have had a little to do with it, but I don't think that's the core of the reason for the rally. I have a feeling the market continues to increasingly realize JCP can survive, and sooner than later will thrive. The bond replacement in question is just one of many advances JC Penney is making to that end. Simply put, JCP is issuing $400 million worth of notes that will be used to replace existing debt. It shouldn't come as a huge surprise that credit rating agencies still aren't thrilled with the retailer; Standard & Poor's rated this issue a CCC-. S&P did suggest the company's interest burden and expenditures would be manageable over the coming year though. That may be enough time to let the company get back on firmer footing, at which point its credit rating will start to tick higher. You guys know how this works though.... investors see things coming well before they actually happen, and they price that progress into the stock's value accordingly. Whatever the psychology is, we continue to hold JCP as a turnaround play, expecting more and more investors to start realizing there really is a light at the end of the tunnel. As for Verizon (VZ) and AES Corp. (AES), although they weren't as bullish as JC Penney was today, they both had good days too. I don't know how much of today's gain from VZ can be attributed to this, but Verizon is really lighting it up on the wireless growth front. Last quarter, the company's postpaid net additions were 40% better than they were in the same quarter a year ago. Now, that's not to say the customer base grew by 40%. The number of subscribers VZ added in Q3 so far is 40% stronger than the number of new customers the company recruited in Q3 of 2013. Still, it's a big improvement. At the same time, Verizon said yesterday it was open to selling some of its cellular towers. It doesn't have to do so, but if the price is right, it could do so without damaging its ability to deliver service. It would just be a straight-up cash infusion. Needed or not, a company can never has too much money. We needed something to get VZ back in gear, and this news may have done the trick before it fell below the 200-day moving average line. No news from or about AES Corp. this week. For what it's worth though, we're losing patience with AES. That's not to say we expected it to soar higher immediately out of the gate. But, we do want to see better early progress than we've seen from the stock so far. If the 200-day moving average line fails to keep acting as a floor, we may go ahead and pull the plug. Be patient for now, however. This is where things stand as of today. We currently don't have any mental stops in place for AES Corp. or Verizon. We're just going to give them the boot via the newsletter if it looks like they're past the point of salvaging. But, let's put a mental stop at $10.20 in place for JC Penney. This leaves us plenty of wiggle room, but should also mean we do no worse than a breakeven on the JCP trade. More Best of the Best (Plus a Pick) Boy, talk about coulda shoulda woulda. As part of our ongoing analysis of all the small caps within the major market sectors, yesterday we narrowed down the best of the small cap technology stocks to Manhattan Associates (MANH). Today MANH jumped more than 4% after opening roughly where it closed yesterday. Obviously I wish we would have made it an official pick. That's ok though. This is a long-term analysis that's bigger than one day's action. We'll get plenty more chances to get into Manhattan Associates on pullbacks in the future if we decide it's a name we want to get into. In the meantime, we've continued to look for the best small caps in the other two sectors we've positively identified as buy-worthy... consumer staples and financials. Well, we've got a "best of" small cap name for one of those sectors today. We like Columbia Banking System (COLB) as the best of the best among the S&P 600's financial stocks. Columbia Banking serves the northwestern part of the nation with its 142 branches. There's nothing especially remarkable about COLB. It's a regional bank, growing at perhaps a faster clip than its peers largely because it's willing to acquire distressed banks in its region. It's an approach that just wouldn't work for the likes of Citigroup (C) or Bank of America (BAC) just because of scale issues. Whatever the growth strategy is, it's working. This year's earnings have been solid, and we have little doubt next year's income will be as strong as planned. More important to you and I right now, the consolidation around the $26-ish area looks like it's run its course. We should soon see another rally like the ones we've seen from Columbia Banking a few times since the 2009 bottom, once the horizontal ceiling at $26.80 is broken. In fact, you know what? Let's go ahead and add COLB to the SCN newsletter portfolio tomorrow. We still don't expect September to be a good month for stocks, but I can see a well-grounded, well-proven small cap bank being seen as a safe haven if things get ugly for most of the market. If not, we'll cut bait on COLB early on, although we're thinking long-term with this banking stock. That's all for today, friends. We'll be back in the saddle this time tomorrow. It should be interesting with the weekend approaching.