Last week brought even more stock market weakness and volatility as the selloff became self-perpetuating, with nobody mid-day on Wednesday wanting to be the last guy left holding equities. Hedge funds and other weak holders exacerbated the situation.

Have you noticed that there hasn’t been much new to say about the stock market and its drivers lately? Bears are weary from calling tops that don’t follow through, and bulls are hesitant to inject more cash until they have a more inspiring catalyst. So, we’re pretty much left to wonder whether the overworked mantra “Sell in May and go away” will be a self-fulfilling prophecy…or a contrarian catalyst for the bulls to get busy again.

U.S. stocks are raring to rally. Earnings reports have been quite good. Consumers are spending despite stubbornly high unemployment. Interest rates are at rock bottom, which is good for borrowing and also makes stock yields relatively attractive. So what’s the problem? Oh, just the usual—fear of a European debt meltdown triggering a global recession.

Editor’s note: The Investor's (H)Edge Portfolio, managed by David Brown, is a long/short, absolute-return portfolio of 13 Longs and 13 Shorts.  Each week David reviews one long position and one short position and either renews or replaces the stocks, based primarily on the stocks' scores in the Sabrient Outlook Rankings.

The market posted a big red candle today. It was much overdue … and in fact needed for a healthy market. It simply cannot go up in a straight line and engender confidence among investors. Backing and filling is a necessary aspect of a healthy bull market.