As third-quarter earnings season gets underway next week, traders are bracing for more volatility in a range-bound market.
"I think we're going to range trade from here until we get (clarity on economic growth)," said Mustafa Sagun, chief investment officer of Principal Global Equities. "Everyone's expecting a fourth-quarter rally, yet if it's not supported by earnings, that year-end rally will come in a very volatile way."
"Guidance will matter more than what the earnings do," he said.
Many analysts say the earnings reports are critical for fourth-quarter gains in stocks and finding clarity on the severity of an economic slowdown, especially amid mixed messages from the Federal Reserve.