A Good Reason to Rest

 | Jan 13, 2012 | 2:19 PM EST  | Comments
  • Comment
  • Print Print
  • Print

We had a decent bounce back to the opening highs, but rolled over with Standard & Poor's downgrade of eurozone countries. The news was expected, but after eight days of upbeat action to start the new year, we were due for a rest and this was a good excuse for one.

Now that the news is out, the issue is whether market players want to buy in front of the blitz of earnings reports that start rolling out Tuesday. As I discussed this morning, expectations, as reflected by the market action, are quite high despite the largest number of warnings in years.

The recent market action has already created a good supply of underperforming investors, which explains all the dip-buying. No one likes to lag the market, and the easiest way to play catch-up is to buy favorite stocks aggressively when there's a pullback.

Technically, the indices are still in good shape and today's action isn't a negative. In fact, it's probably healthy to take out weak holders and let the charts reset a bit.

I'm doing very little and don't plan on any late buying. There are some items on my shopping list, but we haven't pulled back enough to make them compelling, and we obviously aren't strong enough for any momentum.

Columnist Conversations

The Russell 2000 has led the broader market lower and today it returned to its 2014 lows, the bottom end of a ...
Here are the next potential support decisions to watch in SPX cash. Note that the current decline is only sim...
I have been monitoring the price action of Amazon (AMZN) within the symmetrical triangle formation on its week...

BEST IDEAS

REAL MONEY'S BEST IDEAS

Columnist Tweets

BROKERAGE PARTNERS

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.


TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.