Given how strong this market has been for so long, a pullback of 0.5% in the S&P 500 feels like a pretty severe correction rather than just some run-of-the-mill profit-taking.
The big danger in this market is being too quick to conclude that a couple days of weakness is a sign that a major top is in place. It is possible, but bears that are looking for the market to go straight down are likely to be disappointed. Don't forget it's the end of the quarter, and tomorrow is likely the peak day for potential mark-ups. If the big funds are going to run up their big holdings a bit more, then tomorrow will be the day to do it since the last day of the month is a little too obvious.
Some unemployment data will post in the morning, but the main focus will be on the end-of-quarter games. The bears are looking at it as the last big push by the bulls before the manipulation ends and sanity prevails, while the bulls are asking, 'Don't you wish?'
The big positive about action like this is that it gives the market a feeling of normality. Stocks really do move in both directions, and you aren't a fool to lock in some gains now and then.
At this juncture, the selling we have seen does not come close to a major change in market character, but that doesn't mean we can completely ignore it. The dip buyers showed some vulnerability, and if we take out recent lows again in the next couple days it will trigger some stops and hand the dip buyers a few doubts. At the moment, however, we just have a nice little pullback that was overdue and nothing more.
Have a good evening. I'll see you tomorrow.