Dip-Buyers Are Spooked

 | Feb 26, 2013 | 10:45 AM EST  | Comments
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The market is oversold. There's strong sentiment and housing numbers. Fed chief Ben Bernanke has indicated a willingness to continue printing money. Despite all this, there's limited buying interest and the market is hardly bouncing.

It's clear that yesterday's ugly selloff and poor close spooked the dip-buyers. They are afraid of being caught in a failed bounce like Friday and Monday morning, so they are standing aside until someone else shows a willingness to jump in.

I'm watching key names -- Apple (AAPL), LinkedIn (LNKD), Netflix (NFLX) and Google (GOOG) -- and I'm very unimpressed with the interest so far. If people aren't willing to buy recent favorites, they won't be willing to buy the broader market.

I've done a few small trades and sold down shares of the Direxion Daily Small Cap Bear 3X Shares (TZA), which may have been a mistake, but I'm standing aside and waiting to see how things develop. If yesterday's closing low is taken out, it will put the fear of the bear into folks.

This is very unimpressive action so far. A high level of caution is warranted.

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