The bulls were back at it again on Thursday, building on the rebound they started in the middle of Wednesday's session. It still wasn't enough of a buying effort to shake stocks out the rut they've been in since a week and a half ago, however, so you need don't need to pop the champagne corks just yet. We'll take our usual look at the market in a second. First you and I need to finish up what we started yesterday when we explained how the market's movement at any given time is part of three separate trends, each of which has its own timeframe. Let's go. A Snowball's Chance? I'll be real honest with you about what you're going to read next - if you're not a long-term investor and are only concerned about what's going to happen in the next few days, then you can go ahead and skip this portion of the newsletter and move on to the next one. This analysis should only impact the primary trend, aka the current bull market. 'Nuff said? Great. The last time we dissected the S&P 500's first quarter earnings was on May 10th. At the time the index was projected to have earned $25.96 in Q1. Though the number of companies that have posted last quarter's results since then hasn't changed that much [a total of 93% of the S&P 500's constituents have reported first quarter results], with some more time to crunch the numbers, the bottom line figure has been ratcheted down to $25.74. That's more a tad better than the original estimates of $25.49... but just a tad. And remember, at one point during first quarter's earnings season, the projection had been as high as $26.14. Earnings forecasts for the remainder of the year were also dialed down a bit. A total of 66% of the S&P 500's companies beat estimates, and 26% missed. That's a little worse than the norm. Despite the tepid earnings results, the market rallied anyway. As of today, the S&P 500 is trading at a trailing twelve-month P/E of 16.89. That's the highest it's been since 2010 (and the P/E was still on the way down then, as the economy was still shaking off the recession). I know a lot of folks are saying stocks are still cheap compared to long-term averages, and they are. I don't know that I'd call them cheap on an absolute basis though. Thing is, the trailing numbers are purely academic at this point. From here, the only thing that matters is the future... and that's where I get a little more concerned. Never say never, but the pros are predicting a miraculous improvement in the market's rate of earnings growth come the second half of 2013 and all of 2014. I mean, from Q3 of this year on, analysts say the year-over-year earnings growth is going to roll in at double-digit rates in every quarter at least until the end of 2014. And I don't mean "just barely" either. The nearby table tells the tale. None of this is to say that kind of growth hasn't happened in the past. It has. But, it hasn't happened since 2011's low-bar growth, and you have to admit the last year and a half has felt pretty strong, economically-speaking. If it didn't happen in 2012, how's it going to happen in 2013 or 2014? The proverbial "so what" is excessive expectations - if investors are looking for a lot and the market only gives 'em a little, traders tend to protest by selling stocks. Maybe I'm wrong. Maybe the market will end up blowing estimates out of the water. I hope I'm wrong. But, when I take a good long look at the shape of the economy right now, I don't see a lot of things that are going to propel the market next year that aren't in place already. Anyway, this is long-term data, and should only apply to your long-term holdings. And, to be perfectly honest, I wouldn't necessarily 'do' anything with it right now. I just want all of you to get some perspective (and information) I know you're not getting anywhere else right now. Still Spinning Wheels For the third day in a row I find myself wishing I had something amazing to say to you about the market, but for the third day in a row the market didn't do anything worth talking about. So, we can keep this short and sweet.... again. When it was all said and done, the S&P 500 gained 0.37% on Thursday, reversing Wednesday's tepid reversal, but not doing anything that could possibly incite a new wave of buying. The other two indices took the same basic shape. More than that, the pullback from the highs in the latter part of today's trading session says there was little conviction behind the buying effort; traders just don't know what to do here. Our M.O. is still the same - we're only interested in being bearish (with a trade) if the S&P 500 can move under its 20-day moving average line currently at 1643.09. At the same time, the S&P 500 will only enter a new bullish leg if it can hurdle the recently-developed ceiling at 1674.36. Anything else, and the market remains stuck in the mud. You'll notice we've used the chart of the Dow Jones Industrial Average today rather than the S&P 500. That's because there's a key line in the sand that only applies to the Dow - the ceiling at 15,400. Although the DJIA traded above that mark a few times over the past week and a half, the 15,400 level has been something of a headache. The blue chip index will need to clear that mark as well, if the bulls are to have any shot at making another bullish leg. And even then, all of the indices are going to have to face their upper Bollinger band if they do begin to rally. That won't be easy to hurdle, considering the Bollinger band is now sloped downward. I know this is all getting a little repetitive for you, but that's when you need to be the most alert. Everyone else is getting lulled to sleep, which means you'll have an edge once the market finally breaks. Stay tuned. While you're waiting for the market to snap out of its funk, let me refer you to the nearby chart. I've been wanting to tell you about it for a while, but I haven't been able to ... because it's not mine yet to divulge. It's one of the newest picks the SmallCap Network Elite Opportunity gave to its readers. It's also one of the best-looking setups I've seen in a while, and I've got a feeling it's on the verge exploding in a bullish direction. The volume's been building on the way up, and since 2012 the chart's established a pattern of higher highs. I can see a price well above $8.00 being hit in pretty short order. Want to know what it is? I can't tell you, but I can tell you how to find out for free... take a two-week trial of the SmallCap Network Elite Opportunity. Even if you decide it's not for you, at the very least you've heard about a new trading idea that could serve up a huge payoff. Or, you can decide not to try it out (at no charge) and end up missing out on a great trade. Your choice. Check it out. 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/