Equities started the week on uncertain footing rising early in Monday's session and then falling later in the day. The move comes on the eve of the busiest period of the Q1 earnings reporting season and may foreshadow a lackluster season at best. On a technical basis, Monday's move in the S&P 500 confirms the near-term downtrend and sets the index up for a retest of the 4200 level. That test could come this week after reports from companies like Johnson & Johnson, Abbot Laboratories, Tesla Motors, and PPG Industries.

The risk for the earnings season is the guidance. The market is expecting to see supply chain improvements and margin expansion in the back half of the year and they may not materialize. Not only is the war in Ukraine straining the supply chain but widespread lockdowns in China may bring global manufacturing to a standstill. Regardless, if the outlook for improvement sours the market could be in for a deeper correction than it has so far produced.