An Odd Mix

 | Jan 24, 2013 | 4:30 PM EST
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It was an odd mix of action today and it has me concerned that a topping process may be starting. I'm not quite ready to embrace that idea, but there are warnings signs that are making me a little more cautious.

First, the good news. Apple (AAPL) was more a company-specific event rather than a major market event. The very poor action there didn't trigger selling action across the board. A few months ago, an AAPL report like this would have sparked major panic, but the market has been pricing in the specific problems of AAPL for a while, so its impact on the broader market was mild.

The bad news today was that we had what some might characterize as "blow off" top action. The market roared higher on very good breadth out of the gate, despite AAPL, but reversed hard intraday. It managed a late bounce, but it was one of the weakest finishes this year.

The market has had a big run and is entitled to some backing and filling, so I don't want to make too big of a deal out of the intraday reversal and soft finish. But we have to watch carefully to see if other negative patterns emerge.

Other than being a bit extended, this market still hasn't committed any major sins. In fact, a pullback by the S&P 500 to 1475 and some consolidation would set up a very pretty pattern for a potential breakout over the 1500 level. A little weakness would not be a bad thing.

Microsoft (MSFT) earnings are out and the stock is down after hours on mostly in-line numbers. Like AAPL, MSFT is not likely to have any profound impact on the overall market.

Have a good evening. I'll see you tomorrow.

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