The stock market has been swinging wildly but going nowhere.
The dramatic ups-and-downs are reminders of the frightening slides of late 2008 and early 2009. Despite the big moves, however, the market hasn't really ended up far from where it was three weeks ago. That's a signal that things aren't as bad as they were during the depths of the financial crisis.
Sure, there are big questions about whether the U.S. economy can scrape by with high unemployment and a possible slowdown in Europe. But for all the fear, the market has been more like a car revving its engine in neutral. That means stocks could be priming for a turn higher.
A look at the closing prices of stocks since late May shows how little the market has moved overall. On May 21, the Standard & Poor's 500 index finished just below 1,088. On Friday, the S&P closed at 1,092. That's a difference of just 0.4 percent. Going back even further, to one of 2010's low points on Feb. 8, the S&P 500 index ended near 1,057. It's only up 3.3 percent since then.
There have been many huge swings since the market's peak in April but thankfully for most investors they all haven't been down. If all the moves in the past 16 days had been losses, stocks would be down 26 percent. Instead, because of all the zigzagging, the S&P 500 index is down only 2.1 percent.
So what does it all mean?
Some analysts say the frequent shifts are a sign that the market is closer to getting back in balance after the S&P 500 index fell 13.7 percent from its 2010 peak on April 23 until its low of the year on June 7. It's important to remember that it can take time for the market to find its bottom. That means there could be more selling.
"It could go down another 10 percent or so," said John Apruzzese, partner and equity portfolio manager at Evercore Wealth Management in New York. "We had one of the most dramatic drops in investor sentiment that we've ever experienced."
Apruzzese and other analysts note that the big drops in confidence drive away investors and can also make the market prone to a surprise climb. When investors give up, savvy traders often see that as a sign to step in.
It's a given among many professional money managers that everyday investors usually pull out of the market at exactly the wrong time. That signals for the smart money that it's time to move in.
Individual investors funneled $6.3 billion into U.S. stock funds in April when the market hit its highest level of the year. Then May brought the steepest slide for the S&P 500 index since February 2009. Investors responded by yanking $15 billion from U.S. stock mutual funds, according to investment research firm Morningstar Inc. May's withdrawal was the biggest since March 2009, when the S&P 500 index hit a 12-year low and started rocketing higher.
No one can say which way the market will go, but examining some of the key levels that pros are focused on can make the moves seem less confounding.
The number to watch, according to Richard Ross, global technical strategist at Auerbach Grayson in New York, is 1,040 on the S&P 500.
"We're precariously perched on that support," he said. The market has held above that level on three separate times, most recently on Tuesday. Ross said if the index can hold above 1,040, traders betting on a continued slide in the market will eventually give up.
"There's only so many times you put your hand on the hot stove," Ross said.
If the 1,040 level doesn't hold like it did in February, May and on June 8, a bigger slide could be in store. The next level to watch would be 1,000, Ross said.
There's also the 200-day moving average, a level that many traders track. That's a measure of where the market has closed in the past 200 days. Lately, it's been a ceiling. For the S&P 500 index, it's around 1,108.
"It's sign of strength when you're above it and a sign of weakness when you're below it," Ross said.
Even if the market can plow higher again, most analysts agree it won't be as easy as last summer, when the S&P 500 index fell 7 percent from mid-June to mid-July before barreling 26.8 percent higher by year-end.
"I don't think we're envisioning quite that strong of an advance from here," said Brian Lazorishak, portfolio manager at Chase Investment Council in Charlottesville, Va.
Analysts say a bumpier ride is more likely.
Investors are growing concerned about how the economy will respond when it has to do without supports from the government like stimulus spending and low interest rates. This week brings reports on housing starts for May and the National Association of Home Builders' housing market index, which measures industry confidence. The reports will give a read on how demand has been holding up since the expiration of a homebuyer tax credit in April.
"I think the bottom line is visibility about the near-term outlook has dimmed," said Adrian Cronje, chief investment officer at the investment firm Balentine in Atlanta. "It's almost like an aircraft. We've gone through some clouds and you're likely to have a few more air pockets."