Editor’s note: Serge Berger, the head trader and investment strategist for The Steady Trader, will be providing the Daily Market Outlook until Sam Collins returns on July 25.

When all was said and done yesterday, the S&P 500 dropped 0.8% for the day, and the Russell 2000 small-cap index fell 1.55%. The relative outperformer was the Nasdaq 100, with a drop of only 0.54% for the day, which can be attributed to Apple (NASDAQ: AAPL) surging 2.43% to new record highs.

It’s getting somewhat tiring to state this, but the laggards once again were the financials, and with yesterday’s move the sector fell below their June lows intraday, i.e., made lower lows.

The S&P 500 for its part bounced right at the 1,295 level and managed to close well above it. There are, however, several ways to look at this chart now. First, as I have mentioned for some time, for me to get more bullish again on this tape, I need to see a clear and heavy intraday sell-off that lures buyers back in. Yesterday’s candle left a fairly long tail, but it just wasn’t forceful enough of a distribution intraday to qualify as bullish.

Secondly, the blue downtrend line that originated in early May is serving as resistance on a daily closing basis as it has for the past five trading sessions. On the one hand, we can point to the fact that the 1,295 and even the 1,300 level held on a closing basis as bullish signs. In my opinion, we need solid follow-through up day now for these bruised charts to turn bullish.

Additionally, there are some disturbing signs in the industrial and health care sectors, and, of course, in the financial sector. The Industrial Select Sector SPDR (NYSE: XLI) has fallen almost non-stop since the early July highs and technically has taken out just about every support level of the late June rally, meaning it is heading toward the June lows and quite possibly lower.

The usually defensive Health Care Select Sector SPDR (NYSE: XLV) doesn’t look any better as it also just a few dimes away from the June lows. Going into yesterday’s trading session the health care sector looked decent, but with yesterday’s 0.75% drop it also broke support levels.

Turning over toEurope, signs for further weakness are everywhere. Earlier this month, I pointed out the chart of the Spanish blue-chip stock index, the IBEX 35. This index has since fallen out of a four-year consolidation wedge — not a good sign. Bond prices look even uglier as yields have blown higher in dramatic fashion.

Even German stocks are looking weak. As the creditor for much of the mess in Europe, they certainly won’t be unscathed from all of this. The iShares MSCI Germany Index Fund (NYSE: EWG), for example, yesterday again tested recent downtrending support and looks precarious to slip lower.

Despite a bounce and close off the lows inU.S.stocks yesterday, the bulls are not yet out of woods and, in fact, face stiff competition from the bears over who gets to lead us in the next direction. Unless the bulls can find something to hang their hat on soon, I feel like the bears have a good chance at stealing the ball.

For one stock that is close to breaking higher, see the Trade of the Day.

Today’s Trading Landscape

To see a list of the companies reporting earnings today, click here.

For a list of this week’s economic reports due out, click here.