The S&P 500 is barely holding in positive territory, breadth is negative and the Nasdaq 100 ETF (QQQ) is struggling with the pressure on Action Alerts PLUS holding Facebook (FB) but the DJIA is helping to cover up the weak action.
It isn't terrible action but for the second day in a row we are missing the reflexive buying that has served the bulls so well for so long. It may just be a little nervousness in front of the Fed interest rate decision tomorrow but it is a slight change in character.
Selective stock picking continues to be rewarded but the key word here is 'selective' My Stock of the Week, Baozun (BZUN) is breaking out nicely. BZUN known as the Shopify (SHOP) of China and the strong action in SHOP is obviously helping.
Facebook is impacting market sentiment. There seems to be little interest in trying to catch a low at current prices. Technically the FB chart has very little support down to $150. If it continues to downtrend it is going to have an impact on the overall market. Even thought it is largely a company specific problem the market is using it as an excuse for broader selling. Right now the situation is still unknown and unresolved and that is preventing efforts to catch a bottom.
There is a good chance the market will bounce on the Fed decision tomorrow but this Facebook is a problem that may start to infect the indices to a greater degree.