Early Update- Perspective

10:08 a.m. ET

Small Caps show some minor relative strength, interestingly NASDAQ 100 is the laggard for once.

The Energy sector (+9.4%) leads the advance, followed by Industrials (+7.5%) and Materials (+7.9%), while the defensive Consumer Staples sector (+3%) lags.

Volatility continues lower, which is more constructive for stocks.

VIX (15m) dropping below its own bearish flag.

We have a lot of different price action under way. Some like Semiconductors are looking more positive for risk sentiment and the broader market.

Philly Semiconductors Index (15m)

While others are not consolidating at all, just trending lower.

Financial sector (15m) lower highs and lower lows=down trend

Price action looks less worse overall, and is starting to reflect a pause looking for a fiscal deal from Congress. While optimism is increasing today, keep in mind that the market could be disappointed too, whether in a failure to deliver the bill in a timely fashion, or what’s in the bill.

On that note, while not an influential sector, I think Materials is a great example of the current price action on the whole.

Materials sector (15m) made a low last Monday (March 16th). Since then it has traded sideways, which is an improvement from down. However, currently this is a bearish descending triangle, a consolidation/continuation pattern, meaning a continuation of the preceding down trend.

The price pattern could improve from its current stance. For now it’s saying, “pause with a bearish bias”,  waiting for more on the fiscal side from Washington D.C.

I’ll continue tracking the different sectors to see if the balance shifts one way or the other, but for now I think the Materials sector is one of the best summaries of the current environment.