The sharp decline of the previous Friday turned out to be more than just a one day wonder, as stocks continued lower throughout a nervous week. Central banks were out in full force, with three out of the four major monetary authorities (the Fed, the Bank of Japan, and the Bank of England) holding their respective monetary policy meetings last week. Thursday’s British referendum on the EU-membership was all over the news last week, and it is poised to be the prime topic on Wall Street this week as well. The mildly bullish economic releases, like retail sales and the Philly Fed index, were mostly ignored by investors amid international worries, and the central bank “tsunami.”

The Fed held its benchmark rate steady, in-line with expectations, following the lackluster non-farm payrolls number for May. The slightly “dovish” tone of the statement released by Yellen & Co. pushed already low Treasury yields even lower last week. Traders saw record low yields all along the “curve,” as even the 2-year yield, which held up relatively well this year, got close to its multi-decade minimum from last year. Despite the worrisome signs, stocks on average still look encouraging, as the long-term bullish trends remained intact across the board. That said, the Gorilla would be glad to see new highs in the major indices after more than two years of sideways action.

Taking a peek at the technical picture, the price action was decisively bearish, but not disastrous for bulls by any means. The major indices each finished in the red for the week, but the string of higher highs and higher lows wasn’t interrupted for of most of them. The Dow and the S&P 500 closed slightly below their 50-day moving averages, but well above their rising 200-day moving averages on Friday. The Nasdaq still looks the weakest of the benchmarks, as it finished below both the short- and the long-term average. The Russell 2000 provided a reason for optimism again, as the small cap index closed the week above both of these crucial moving averages. The Volatility Index (VIX) exploded higher on Monday and finished in the “danger zone,” above 20, at the highest level since February.

Market internals remained solid despite the negative headlines, as the relative strength in small caps continued to support the broader market. The Advance/Decline line stayed near its recent highs although declining stocks outnumbered advancing issues by a 2-to-1 ratio on the NYSE and by a 3-to-1 ratio on the Nasdaq. The daily number of new 52-week highs averaged 95 issues again on the NYSE but declined to 43 on the weaker Nasdaq. The average number of new lows roughly doubled on both exchanges, to 30 on the NYSE, and to 66 on the Nasdaq. Just above 60% of the listed companies traded above the 200-day moving average at the end of the week, meaning that participation is still consistent with an ongoing bull market.

The list of the most shorted stocks on the NYSE and the Nasdaq was mostly unchanged, with biotech, and health-care firms still dominating the top 10. Medical marijuana producer INSYS Therapeutics (INSY) registered the highest short interest ratio (77%) last week. The short interest in Tesla (TSLA)-owner Elon Musk’s SolarCity (SCTY) climbed above 40%, as low margins in the sector pushed the price of the stock down by more than 60% this year. Bears increased their bets against on-line credit company LendingTree (TREE) as well, pushing the short-interest up to 47%. The day-to-cover ratio (DTC) of international payment provider Western Union (WU) rose above 20, despite the strong performance by the stock this year, putting bears in the crosshairs.

The unusually heavy volume and increased volatility are likely here to stay, at least for the course of this week. Besides the “Brexit” vote on Thursday, the Gorilla will keep a close eye on financial stocks as U.S. banks, such as Citigroup (C) and Bank of America (BAC), are following their European counterparts lower. With the likes of Deutsche Bank (DB) and Credit Suisse (CS) trading below their 2009 lows, it will be interesting to see how things unfold in the sector. So, as the second quarter draws to an end, traders certainly have the “wall of worry” in front of them. Despite the obvious concerns, bulls still have good-looking charts and some encouraging economic numbers to base their optimism on. Stay tuned for another exciting week on Wall Street!