Our model readings are showing some exhaustion signals from last week across the board, yet the theme from last week remained; Large caps are holding strong against small caps while growth is beating value.

Despite Friday's strong rebound, we are still in the choppy trading zone that goes back nearly 1 year. Traders continue to look to 4,180 as strong resistance and the line in the sand for bears. As we mentioned last week, this sideways trend has been driven by better-than-expected corporate earnings offset by the economic slowdown and fear of regional bank collapse.

On the economic front, we will get more information on inflation after the CPI report Wednesday. Estimates are calling for a 5% year-over-year rise and a 0.4% monthly rise. Last Friday, the blowout jobs report likely support bets on the Fed holding rates for longer than expected. Markets had priced in a cut in July, however after the jobs report, those bets waned and were pushed out until past September.

Among sectors, we are seeing strength out of Technology, Real Estate, and Utilities while Energy, Financials, and Industrials are at the bottom of the pile. Picking names with relative strength within sectors has remained the dominant and most effective strategy.