It's Just Healthy Profit-Taking

 | Aug 10, 2012 | 11:45 AM EDT  | Comments
  • Comment
  • Print Print
  • Print
Stock quotes in this article:

TZA

,

myl

,

pfmt

The first pullback after a five-day run is usually going to attract quick dip-buying. A straight-up move like that creates a large supply of folks frustrated that they missed out, which makes them buy more aggressively when the market finally does pull back a bit. The bounce isn't gaining much momentum so far, but the indices are off the lows and breadth has improved.

It is a summer Friday and the bulls have enjoyed a good week, so it shouldn't be a big surprise if things drift around today. In fact, some backing and filling would be very healthy. It also wouldn't hurt if the positive sentiment were tempered a bit. An awful lot of fearless bulls celebrated the market yesterday, and that is seldom a good sign.

I sold down my Direxion Daily Small Cap Bear 3X Shares (TZA) position from earlier in the week for a small gain. I'm probably premature on that but there is too much potential for European Central Bank action soon and I don't want the risk.

In individual names, Mylan (MYL) is a slow mover but has a nice-looking cup-and-handle setup. I'm also tracking Performant Financial (PFMT), which debuted today and is attracting attention from the hot money.

So far, it's just a day of healthy profit-taking and there doesn't seem to be any reason to read much into it.

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.