The market is seeing the choppiest intraday action in weeks, and its benefiting the bears as a big bounce is sold hard we struggle to hold the intraday lows.
What is most notable about the action today is that breadth isn't that bad at about 2,250 gainers to 3,050 decliners. There are also some good pockets of momentum such as F5 Networks (FFIV), VMware (VWM) , Silicon Motion Technology (SIMO), eBay (EBAY), Tangoe (TNGO) and so on.
The selective buying in the face of the struggling indices is a good sign, as it indicates that there isn't a high level of panic or real concern about the macro picture. The stock pickers are still active and why shouldn't they be when there were some pretty good earnings reports?
The biggest negative right now is the technical condition of the major indices. They are all poised to roll over and retest recent lows. They are struggling with overhead resistance, and they just aren't set up very well for buying right now.
With the indices looking this way, it isn't surprising that the mood is turning more negative, but I disagree with the notion that there is too much bearishness. In fact, I'm concerned that there isn't enough, and that means a greater likelihood of more downside if some of the stronger names start to falter.
It is a odd brew of action today, with selective longs working but a deteriorating big picture. Caution and selectivity is warranted.
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