As thermometers around the country break the 100-degree mark, it’s not unusual for the markets to swing 100, 200 or 300 points, too, with stocks going along for the ride.

While most investors have become accustomed to wild dips and flips in the stock market’s major indices, the likelihood of volatility is historically greater in the summer months.

What’s more is that our indicators continue giving us bearish readings.

June historically is not a good month for stocks, and that proved to be true again this year and it looks like July may follow suit.

Primarily, the Dow Transports (DJT) and Dow Utilities (DJU) are rolling over like beachgoers in the sun and showing signs of returning to bearish trends.

These two sub-indexes have been bullish for the past several months and have given investors hope that the Industrials could return to bullish trends, too.

However, the opposite seems to be happening as the Transports and Utilities appear ready to confirm another leg down for the overall market.

After easily taking out the Dow 11,750 support, the Industrials are now looking at 10,700 as the next line of support. That’s about 700 points from current levels and would mirror prices we saw in early 2006.

If you’re hoping for a bottom, there is scant evidence that a “capitulation” has occurred. (To learn more about this trend, see also: “Stock Market Capitulation.”)

While volatility isn’t anywhere near the levels we saw earlier this year, a swift slip to 10,700 would quickly change that. If that happens, then it might be possible to think about a bottom.

With the likelihood of a sharp sell-off still looming…