Welcome back, everybody. We hope you had a nice and restful weekend. The market sure seemed to start the trading week well-rested, powering to new multi-week highs and punching through some key resistance lines in the process. As much as I didn't expect it, the indices are - from a technical perspective anyway - back in a bullish mode. That's not to say I'm a full-blown bull here. We've all probably seen more than our fair share of fakeouts from the market, and this one may end up being just another headfake too. If this is a false breakout though, it's a pretty darn convincing one. We'll look at everything that went right for the market today in a second. There are a couple of housekeeping items we need to take care of for you first. Portfolio Update I'll confess I'm breaking one of my own hard-learned rules of trading by doing what I'm about to do, but by not doing it, I could be breaking another one of my own personal trading rules. What rule am I breaking? The "never look back" rule, which is simply a way of not putting yourself through the frustration of second-guessing a trading decision you wish you hadn't made. And what rule am I following? The "don't let emotions blind you to reality" rule, which just means every trade should be viewed and handled in a vacuum, and judged only on its merits and nuances... not influenced by other trades from your past. With that as the backdrop, remember the Commercial Metals (CMC) trade we dropped at the end of August after getting into it in late July? While we still thought there was some underlying upside there, once CMC shares fell under a bunch of key moving average lines a couple of weeks ago we had to maintain enough trading discipline to boot the stock as a hypothetical holding. It stinks, but that's the name of the game - discipline. Care to guess what's perked up in the meantime? Yep, Commercial Metals shares. In fact, they've perked up with a vengeance, leading it to give us a new buy signal with one of the many trading sort-n-scans we run every week. I'm not interested in stepping back into it just yet. It looks a little overbought and ripe for another pullback. If we do get that move lower, however - and if we see some support kick in again around $15.30 - we may well move back into a position. See, the bigger trend is still bullish. Take a look at this weekly chart to see what I mean. Normally I wouldn't have even seen this rebound, following my "don't look back" rule. But, my perpetual scans for budding stock rallies (which forces me to take a non-emotional, fact-driven approach to stock picking) just happened to put Commercial Metals back on my watchlist. Now it's all about timing. Just wanted to give you a heads up on something that was brewing. I've got another stock to add to the watchlist later on this week too. This one is very much aligned with the bigger water-infrastructure theme trade I've been talking about for a few months now. The underlying technology is just really, really cool. In the meantime, I'm still pretty happy with the first water infrastructure pick, Northwest Pipe (NWPX). Oh, it's been pretty erratic since our entry back on June 28th, but it's at least been bullish during that time; it's up about 5% since our entry around $28.00 per share. More than that though, I get the feeling the stock's about to get slung out of a consolidation range that trapped it for the better part of August. More precisely, I'm expecting a repeat of what we saw in early July when Northwest Pipe shares were flung out of their May/June trading range. One more nudge above the 50-day moving average line at $29.43 should do the trick, though there seems to be something of a ceiling around $30.00 as well. Whatever the case, I'm looking for NWPX to continue the bullish stairstep pattern that's been in place since late last year. We're also still holding Xerox (XRX), Kearny Financial (KRNY), and Global Indemnity plc (GBLI). Not a lot worth mentioning there today, other than just knowing Kearny is on the mend again after last week's pullback. We'll take closer looks at all these open ideas later on in the week. By the way, the folks over at the SmallCap Network Elite Opportunity published something of theme-based idea themselves. They're thinking a little more broadly than I am with water or IT security stocks (another one of my 2013 hot buttons) as a trade-worthy theme, but John Monroe made some great points in today's newsletter about recent clues surrounding this one particular arena. The good news is, the SCN EO hasn't actually recommended a pick yet so you've still got time to become a subscriber and claim your front-row seat for when the pick comes. And, after scoring a 70% win with Advanced Micro Devices (AMD) earlier in the year and locking down more than a 50% win with Nokia (NOK) last week, I'd make sure I was first in line for the SmallCap Network Elite Opportunity's next pick. If you're on the fence about becoming an SCN EO member, I recommend using their offer for a free two-week trial. You'll get everything a regular subscriber gets during that time, including any new picks. Here's how to get it. Or, copy and paste the following link in your browser: http://www.smallcapnetwork.com/?vmpd_ckstr[click_track]=SCN+Newsletter&vmpd_ckstr_redirect=/pages/SCNEO/v1/ Now, onto the market-related stuff. Too Perfect? I'm sure you've heard the phrase "If it sounds too good to be true, it probably isn't." It's that axiom that has me distrusting today's breakout moves from each index. They're all almost textbook-caliber thrusts, materializing at a point in time when it's the last thing you'd expect. I'm trying my best not to be biased and adhere to my "don't let emotions blind you to reality" rule. But, I don't mind admitting it's tough to do here. In rapid-fire fashion... The NASDAQ Composite broke past a ceiling at 3964 today to reach new multi-year highs on Monday. That push also carried the composite above its upper 20-day Bollinger band. On the flipside, the volume behind today's rally wasn't particularly compelling, considering the size of the move and the fact that we're now in multi-year high territory. You can also see the VXN didn't move below its 20-day moving average line at 15.7, suggesting there's some hesitation here even if the NASDAQ itself doesn't show it. The Dow Jones Industrial Average also made its way back above its 20-day moving average line, and had formed a nice, even, U-shaped reversal effort since the August pullback. The S&P 500 not only fought its way above the 20-day moving average line at 1655.80, but it also hurdled the 50-day moving average line today. Like the NASDAQ, the S&P 500 also has a flipside...the S&P 500's volatility index also didn't move under its 20-day moving average line, suggesting there's some hesitation here despite the market's jump. The volume wasn't exactly stellar either. And, I can't help but notice the small blip above the 50-day moving average line in mid-August didn't get a rally going, leaving me to wonder if this is just going to be a repeat performance. It's tough to get a read on, which is why I think the best move right here may be to do nothing until there's some more clarity. We know that's not a very fun or exciting nugget of advice, but it's a prudent one. At the very least we'd need to see some confirming bullishness for the budding breakout effort. Whatever happens, don't worry - we're still expecting some market-moving fireworks to start popping soon. You'll want to be around for 'em.