I am looking to the S&P500 to get some guidance on the broader market near term, but I can't really get any. Let's use the SPX as a proxy.
The first thing to notice is the double top formed last month at the 1350 level. In the first part of July SPX traded up just over 1350 and then it fell back to 1300. From 1300 it went back up, but this time it pulled back just shy of 1350, bearish. The double top was confirmed when SPX traded back under 1300 last week. So, for now 1300 is definitely resistance. Yesterday despite the gap up at the open SPX fell like a stone back through 1300 and finally settled at 1286.94.
Looking at some momentum indicators 1286.94 is very interesting because it matches the 200 day moving average. Keep in mind that bullish stocks typically trade well in advance of their 200 dma where bearish ones typically trade under it. So, if SPX drops under it's 200 dma it will be another (significant) bearish indication for the broader market. Also notice how the 200 dma provided support twice in June actually defining a double bottom between 1250 and 1275.
Now look down at the stochastic. You can see how it is at the bottom, stopped and appears to be turning back up. This is strongly bullish and conflicts with the bearish data above. So, which way will the SPX break? I couldn't care less. Right now the thing to do is watch the battle between the bulls and the bears and then make sure we get in on the right side when the market makes up it's mind.
I will say this, I think the bulls have a lot more at stake here than the bears. If SPX fails here not only will it be under it's 200 dma, but it's overall trend will have changed from up to down. To see what I'm talking about go all the way back to September on the chart. From 1050 to 1370 you ca see a general increasing of SPX. You see it fall from it's max in May back to the double top in July. If you draw a straight line from the May high to the high in July you have a trend line with negative slope, that is the change in direction. Furthermore that down ward trend line will be in until it is broken. There is no sounder reasoning. I think that if 1275 gets broken with any force then "look out below."