Momentum has slowed for the second day in a row, but the tendency has been some late buying that produces a strong close. With overseas markets operating on Monday when the U.S. is closed, there may be a little reluctance to add new inventory. But in this market, you can never count out the buyers.
Intraday action is soft, with breadth moving toward 2 to 1 negative. But what is most interesting is that the number of new 12-month highs has fallen sharply to around 200. It had hit over 1,000 about a week ago, and has held up well, but today we don't have any notable sector strength.
The list of leaders is a mixed bag -- with a few technology names, like Arista Networks (ANET) and Cognex (CGNX) leading, along with Action Alerts PLUS holding Kraft Heinz (KHC) and Unilever (UL) -- on the takeover news. Biotechnology, financials, oil and most other key sectors are down. Precious metals are showing a little relative strength, and I'm adding Gold Resources (GORO) as it develops.
I've been rooting for some softness in individual names, and we are finally seeing some. But it is premature to look for entry points. I have a few things of interest today -- such as Oclaro (OCLR) , which should benefit from Finisar's (FNSR) loss of business. I also like the chart developing in Corbus Pharmaceuticals (CRBP) , and have started a position.
The indices look like they are going to test intraday lows, which is something we haven't seen at this point in the day for a very long time. There has not been a close at the lows this year -- other than one very minor day. The programs are set up for the late buying, so it will be instructive to see if they take a break today.
