It has been a slow drip of selling so far today, but as the day winds down and the last chance for some end-of-the-quarter window dressing approaches, we are finally seeing a little dip-buying. Market players are looking a little skittish, but they haven't given up on this market yet.
In fact, as we end the quarter and start a new one, I would be surprised if we didn't see at least one more good upside spike. The first day of a new quarter has a strong positive tendency and I'll be watching for that.
I don't want to sound overly bullish because there are some cracks in this uptrend and some worrisome signs. The fact that we have had three days in a row of lower lows is a shift in the action and, as I commented earlier, the excitement over IPOs is a textbook contrary indicator.
The pullbacks in leadership stocks just signify a healthy consolidation at this point. They are not major technical breakdowns. That is helping to keep the negativity in check but some of the damage done to small-caps is already quite severe.
I wouldn't be surprised to see the bulls to make a late-day window dressing push but there are good reasons for increased caution right now. I have pared back my long exposure substantially and will rebuild those positions slowly as the charts develop. I just don't see a good reason to be overly bullish right now.
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