Watch for an Intraday Reversal

 | Dec 06, 2011 | 10:49 AM EST
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Underinvested bulls continue to provide underlying support, but upside momentum is sparse this morning. The longer we hold, the more likely it is that buyers will be more aggressive, but it's a gross understatement that this market could use a rest.

Breadth has come back from early weakness, but the only green sectors are chips and drugs so far. Financials and retailers are holding steady, which is probably the biggest positive. Gold is breaking support and looks precarious, and oil is seeing some profit-taking.

I've not been interested in the short side lately, but I'm watching carefully for some sort of intraday reversal. The chances of a bout of profit-taking are growing, and I'll be watching for signs of weakness after Europe closes.

I'm still looking for individual longs. I've added some shares of Procera Networks (PKT), which is breaking to a new high on good early volume. Unfortunately, the pockets of hot momentum stocks such as MercadoLibre (MELI) aren't there, even though the market is pushing to the highs of the day.

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